THE decision by Qantas to move Jetstar's Newcastle operation to Melbourne at a likely cost of about 200 jobs at Williamtown is only part of a massive restructure at Australia's biggest airline as a result of COVID-19.
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Qantas is sacking 6000 people, continuing to stand down 15,000, raising $1.9 billion in new capital and grounding a substantial portion of its fleet, all while taking support from JobKeeper at the same time.
As it happens, CEO Alan Joyce's path to the top of the Australian aviation industry included a stint running Jetstar, which Qantas began after buying Newcastle-based Impulse Airlines from founder Gerry McGowan in 2001.
CORONAVIRUS CONCERNS:
The timing was incidental, but yesterday was also the day the Australian Bureau of Statistics released its regional breakdown of the May labour force figures. Newcastle and Lake Macquarie showed an unemployment rate of 10 per cent, the first double-digit result since January 2003.
With the rest of the Hunter Valley included, more than 30,000 jobs were lost in a month.
Earlier this year, when there was still optimism that the coronavirus impact would be sharp but short, a quick return to a healthy economy still seemed possible.
As each day passes, this looks increasingly unlikely.
The Qantas move is the corporate equivalent of battening down the hatches for a long, long period of extremely bad weather.
International and regional travel restrictions mean airlines everywhere are facing precarious futures.
Mr Joyce said yesterday he did not expect a return to normal international travel for at least another year.
With COVID-19 infections accelerating globally, and without a vaccine in sight, even that appraisal may turn out to be optimistic.
JobKeeper's help to the region was also demonstrated yesterday, when Hunter Business Chamber published a summary of JobKeeper applications by postcode, from Treasury figures released on Wednesday.
More than 1,000 applications came from Charlestown (1147) and Maitland (1104). Other areas in the region that saw high numbers of organisations applying for the subsidy were Newcastle (865), Cardiff (792), Belmont (758), Minmi (715), Merewether (668), East Maitland (629), Adamstown (628) and Cessnock (632). This suggests a strong case to maintain wage subsidies beyond September
- Bob Hawes, Hunter Business Chamber CEO
By June 3, Treasury had processed applications from almost 18,500 of the region's businesses and not-for-profits for the two payment fortnights in April.
At $1500 a fortnight, that's more than $50 million for the month, if all applicants were sole traders. The real amount, then, will be much higher.
Even with the latest Victorian outbreaks, and two more deaths, Australia is escaping the worst of the virus.
The economic pain, however, is nowhere near finished, regardless of what happens from here.
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