ANALYSIS: Coronavirus is holding the economy hostage — and the Victoria situation won't help
This argument is obviously controversial. And for good reason: lives and livelihoods are at stake.Economists say the only truly effective way to bring down the unemployment rate or underemployment rate, which some argue is actually up to just under 20 per cent, is to allow the economy to grow.
Think of someone with a cast around their broken leg. There's no hope of them running again until the cast is off and they've been through some rehabilitation. But here's a chart from the Grattan Institute which demonstrates how long unemployment can stay elevated when an economy can't break free from the grip of an economic downturn.We need to accept that while this will help keep the most vulnerable in the economy afloat, the price is that we make little to no progress at all in materially bringing the unemployment rate down or lifting wage growth.
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