Omicron surge increasing drag in Australia’s economic recovery

On Wednesday, Australia’s New South Wales, its most populous states, saw a significant increase in Omicron infections leading to staff shortages that have disrupted supply chains hampering its economy’s recovery.

Businesses are grappling with a growing toll of workers who have either reported sick or have been ordered to isolate themselves after coming in close contacts with those who have been infected.

The Omicron variant is also scaring customers away from airlines, entertainment and hospitality sectors, which have already been battered by past variants over the past two years.

“Essentially (small businesses) are in a lockdown … there is little support out there to help them keep their doors open,” said Alexi Boyd, head of the Council of Small Business Organisations.

On Wednesday, Australia’s daily infections hovered around 100,000, with 42 new deaths being registered. New South Wales suffered its worst day of the pandemic, with 21 deaths.

In a research note ANZ said, labour shortages and caution about being in public places have reduced household spending: spending in early January is resembling lockdown conditions in Sydney and Melbourne.

Before the outbreak of the Omicron variant during the Christmas period, the Australian economy had been making a surprisingly strong recovery. In November 2021, employment levels rose far faster than expected as coronavirus lockdowns were lifted, and retail sales surged for a second consecutive month. 

Categories: Creativity, Economy & Finance, Entrepreneurship, HR & Organization, Strategy

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