3065 people have already claimed the special benefit for people left unemployed due to the Christchurch earthquake. Once that payment expires in a few weeks they’ll be on the dole, if they’re eligible. The quake killed and did physical damage in seconds but, without action, it will keep strangling the economy and taking jobs for months.
It’s worrying that so many jobs have been lost so quickly. The government’s wage support scheme effectively pays quake-effected worker’ wages up to the minimum wage, leaving the employer to top up the rest. It appears a lot of employers are finding the subsidy isn’t enough and they’re better off shutting down or laying off staff than trying to pay the unsubsidised portion of their wage bill.
Each job that goes sucks a little more life out of the local and national economy, triggering further job losses for people who don’t get a special earthquake benefit. Job losses will see more families default on their mortgages, or go bankrupt, and many will upsticks permanently for another part of the country or Aussie.
There’s a lot on the government’s plate but stemming this tsunami of job losses through more assistance and working with the banks to offer mortgage relief, which some banks are already doing, needs to be a priority or the life will drain out of the city, making rebuilding even harder.
This collapse of the private sector just confirms the leading role the government will have to take in the rebuild.