Hours worked and income earned were inching back to levels recorded in February at the start of the COVID-19 pandemic. By November, there was a large increase in household income although changes during the year were uneven across income groups.
Average hours worked reached just under 21 in November, the highest at any point during the pandemic
Fears about losing a job eased with 22% concerned
Average after tax income per household rose by 8% from August to November
Average after tax income was just $36 a week less than it was in February
Average hours worked per week hit their highest figure in November than at any time during the pandemic period. There was a large increase between August and October with the increase from October to November (from 20.4 hours to 20.6 hours) relatively small.
Average hours worked are still lower than they were in February (21.9 hours worked).
With restrictions from the second pandemic waves easing, Australians became slightly less worried about losing their job over the next 12 months. In October, 22.8 per cent thought the prospect was probable; by November that fell to 22.4 per cent.
There was a very large increase in household income between August and November 2020. Average after tax income per household rose by $121 a week to $1,725. This was an increase of 7.5 per cent. Household income rose to only slightly less than it was at the pandemic’s start in February.
Over the 40 weeks from March 2020 to the end of November 2020 it is estimated the average household lost $4,726 in income. This equates to a total loss of $46.7 billion for households over the COVID recession.
The change in income over the COVID period has not been even across the income distribution.
Between February and November, the decline in income at -0.8 per cent was smallest for the 5th quintile which is made up of the top 20% of income earners and at -1.3 per cent for the 1st quintile which is made up of the 20% bottom income earners. The introduction of government support measures helped improve incomes for the lowest income earners during the period.
Those in the middle income quintiles had the greatest falls in income. Income for the second bottom group (the 2nd quintile) fell by 4.1 per cent. The decline for the middle income group (the 3rd quintile) was slightly smaller at 3.6 per cent. The second top group ( the 4th quintile) had income decline by 2.5 per cent.
Inequality declined slightly during February and April 2020. Between April and August, there was a large increase in inequality. The gap closed a bit during August to November. But all four measures of inequality were higher at the end of the pandemic period than at the start.
Those households with their main source of income from self-employment or farming had a larger drop in income than those whose income came from wages, salaries or transfer payments. Those whose main source of income was from investments had an even greater drop.
Couple families did better than single parents and other non-couple households which experienced a greater loss in income.
Females didn’t experience a greater or lesser loss in income for their households than males. Older Australians had a larger drop in income than someone aged between 35-44. With other characteristics being equal those aged between 65 - 74 had a drop in income more than $8,000 more than their younger counterparts.
While the sample size was small, there was a large loss of income for the households of Aboriginal and Torres Strait Islander Australians than for households of non-indigenous Australians.
Those who had post-school qualifications had the smallest income loss, as did those who live in wealthier areas meaning location and qualifications appear to be the greatest protective factors from the COVID-recession.