Bleak Aust. outlook

Press, 24 June 1986, Page 22

Bleak Aust. outlook

PA Canberra Five years of sustained economic growth at 3.5 per cent would be needed to reduce Australia’s unemployment level by a mere 0.5 percentage points, according to an Economic Planning Advisory Council (EPAC) paper. The paper — Trends in the Labour Market — said real growth in gross domestic product of 3.5 per cent per year will be needed to reduce the unemployment level to 7.4 per cent by 1991. EPAC — the Federal Government’s major and most prestigious advisory body — said 4.0 per cent growth would give an unemployment rate of 6.3 per cent, and 4.5 per cent growth would give a rate of 5.1 per cent. The paper provides a warning that Australia can expect no immediate and dramatic

fall in the unemployment rate, currently at 7.8 per cent.

Commenting on figures provided in the paper, EPAC said “it can be seen that even under conditions of sustained economic growth, many years will elapse before the rise in unemployment over the 10 years to 1983 can be reversed”. "The return to lower rates of unemployment will be a difficult and challenging task for some years to come,” it said.

But the paper said the fall in unemployment would be expected to accelerate in the five years to 1996 to give , an unemployment rate of about 4.8 per cent by that year. It pointed also to the significant growth in employment levels in the past three years

despite the high unemployment rate. It said the large gap between the gains in employment and reduced unemployment was because of the large increase of over 500,000 in the labour force in the past three years. The paper said the recovery from unemployment which started in 1983 — the year the Hawke Government came to office — was stronger than any since the 19505.