New independent economic analysis from one of Australia’s most eminent experts, Chris Murphy, has found that the economic impact from the Million Jobs Plan will ensure a stronger economic recovery from the COVID-19 recession.
Commenting on the analysis, Chris Murphy said:
“My modelling of the national economic impacts of this Plan shows that it contributes to a stronger economic recovery from the COVID-19 recession. It does this by adding an average of $25 billion to private investment over the next three years as Plan projects are developed.
“The demand stimulus from this development work means that next financial year (2021-22) there are an estimated 124 thousand more jobs with the Plan than without the Plan.
“In the medium to long term, the additional investment in low-carbon technologies in areas such as housing, electricity generation and transmission and manufacturing contributes to higher productivity. This means that real after-tax wages are 1% higher in 2022-23 and 2% higher by 2035-36 than they would be without the Plan. Similarly, higher productivity adds between 1% and 2% to GDP.
“The Plan’s approach of using government support to leverage private investment also helps stabilise government finances, compared to alternative strategies relying more on public spending.
“In all, the key to a stronger economic recovery with lower unemployment, higher living standards and contained government debt will be policies like this Plan that stimulate higher, productive private investment.”
Key Findings:
- The Million Jobs Plan will boost private investment by $25 billion annually, or nearly 2% of GDP, and adding 1 to 2% to GDP.
- It will increase real wages by 1% in 2022-2023 and 2% by 2035-2036 [currently wages are lower than those in 2011].
- By the 2021 financial year, there will be an estimated 124,000 more jobs with the Plan than without the Plan.
- In the medium to long term, the additional investment in low-carbon technologies in areas such as housing, electricity generation and transmission and manufacturing contributes to higher productivity.
- This means that real after-tax wages are 1% higher in 2022-23 and 2% higher by 2035-36 than they would be without the Plan.
- The Million Jobs Plan will give a major boost to diverse business sectors and provide jobs throughout Australia – over 70% in regional areas. The plan delivers results almost immediately and its benefits persist for many years.