Independent economic modelling from one of Australia’s most eminent experts says the Million Jobs Plan will drive recovery

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.

17 September 2020

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.

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