Businesses struggle to stay afloat in the absence of JobKeeper payments

There are early signs that some companies are struggling to stay afloat in the absence of support from the JobKeeper wage subsidy.

New analysis from commercial credit bureau CreditorWatch found that businesses’ external administrations rose 24% in the past three months and defaults rose 9%.

“We’ve been saying for some time that we won’t be able to get a true picture of the nation’s economic health until federal stimulus packages, such as JobKeeper, are completed and their impact has ceased to artificially support. certain companies, ”said Patrick Coghlan, CEO of CreditorWatch.

The JobKeeper program ended in March.

He said there were early signs that there would be an upheaval of underperforming companies over the next two quarters.

There are signs that some businesses are struggling to stay afloat in the absence of JobKeeper. Credit: PAA

Even so, he said it was not all pessimistic, with the defaults remaining 50% lower than pre-COVID levels.

The Australian Bureau of Statistics will release its latest payroll data and a series that has highlighted job losses since JobKeeper’s demise, though nowhere as bad as some had initially feared.

Reserve Bank for Financial Markets Deputy Governor Christopher Kent will have the opportunity to present the central bank’s perspective on recent and largely positive economic developments when he addresses the KangaNews Debt Capital Markets summit Wednesday.

In the last week alone, it was confirmed that the economy had fully recovered from last year’s recession by the end of the March quarter, job vacancies remain buoyant and point to a further decline in the unemployment rate and trading conditions hit a new high. .

However, the ANZ-Roy Morgan Weekly Consumer Confidence Index – an indicator of future household spending – eased for the second week in a row with mixed results across the country.

Confidence among Melburnians remained uncertain due to its COVID-19 lockdown, but Sydneysiders were more optimistic after confidence fell sharply the week before.

The Westpac-Melbourne Institute’s monthly consumer confidence survey is released on Wednesday.