Economic forecasts for the Bega Valley following both the bushfires and COVID-19 pandemic paint a picture of falling gross regional product - the measure of our economic output, rising job losses and increasing unemployment.
The forecasts are contained in a draft report prepared by demographic consultants .id, for council and show that the shire is facing several risks in its recovery from both the bushfires and the COVID-19 pandemic.
The .id report says that the combination of both events will mean the Bega Valley economic activity will contract significantly with a full recovery not expected before the end of 2021.
The economic data that was presented at a workshop for councillors paints a picture of a shire in need, not just currently but into the future and will reinforce calls by those who have asked for assistance with projects such as the Merimbula CDB.
Such calls will be reinforced by separate research into communities that are the most vulnerable to long-term impacts from COVID-19 showing Merimbula is ranked number 2 out of 72 locations in NSW, below Byron Bay.
The research was carried out by the University of South Australia, the University of Newcastle, and George Mason University in the Washington, DC area.
The pandemic and bushfires have hit two vital sectors for Bega Valley, agriculture and tourism which .id says accounts for around 23 per cent of economic activity.
With respect to economic recovery the report says Bega Valley's recovery beyond 2020 faces several risks, including impacts on casual and female workers and high share of impacted industries (such as tourism).
However, .id says that due to the Bega Valley's "low international exposure" there may be a chance of faster recovery.
The report says COVID-19 will have a significant impact on Bega Valley's economy, more than other areas in regional NSW
Bega Valley's gross regional product (GRP) is forecast to fall by $52m in the June quarter 2020 (compared to the average quarter in 2018/19) the report says.
This represents a 13.9 per cent fall. The regional NSW average is 10.4 per cent and state average is 13.6 per cent. It is forecast to be 6th worst impacted among regional NSW LGAs.
The report states job impacts are large and workers are more reliant on JobKeeper than other areas in regional NSW and the state.
Local jobs are expected to fall by 8.1 per cent (1139 jobs) in the June quarter 2020 compared to the previous year and again the figure is higher that the regional NSW average at 6.7 per cent. Bega Valley is forecast to be 4th worst impacted among 95 regional NSW LGAs in terms of percentage of jobs lost and jobs compensated by JobKeeper payments.
Not surprisingly accommodation, food services and retail are the sectors that are forecast to be hardest hit. The report says overall impacts are higher as its industry mix is more exposed to COVID-19 impacts in tourism and hospitality.
The report warns that over 70 per cent of accommodation industry jobs are either lost or reliant on JobKeeper. If these jobs are lost (permanently), Bega Valley may not be able to serve domestic overnight tourists once restrictions ease.
Bega Valley Shire as a whole has experienced an 85 per cent uplift in people accessing unemployment benefits from December 2019 to June 2020, this is well above the regional NSW average, the report said.
While COVID-19 has had a larger impact on unemployment, the bushfires have also taken their toll in the Bega Valley.
From December 2019 to March 2020, there was an increase in people accessing unemployment benefits in areas more severely affected by bushfires, such as the Bega-Eden hinterland and Narooma-Bermagui area.
But from March 2020 to June 2020, there was an increase in people accessing unemployment benefits in areas with a higher share of tourism and hospitality workers such as Merimbula and Tura Beach.
In terms of recovery the report concludes the Bega Valley's economy could take more than two years to recover back to the December 2019 level. How the recovery rolls out will depend on restrictions in Victoria, government stimulus and cases in NSW.
The report highlights a number of areas where the Bega Valley has high vulnerability in its capacity to recover. These include no growth in GRP or jobs, in the three prior years, low rate of building approvals in prior years, high reliance on impacted industries and a high level of part-time workers.
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