EDITORIAL:
As the number of Covid-19 cases eases, the jaws of the lockdown are tightening on the New Zealand economy. The local parent company of fast food franchise Burger King yesterday fell into receivership in the latest blow to the hospitality industry. Many companies, including Herald publisher NZME, have announced redundancies and asked staff to take pay cuts. Air New Zealand is looking to lay off a third of its 12,500 staff. Magazine publisher Bauer has shut up shop entirely in this country.
Treasury yesterday released a series of scenarios on the potential economic effects of Covid-19. At the more optimistic end, it picks the unemployment rate — which is just over 4 per cent at present — could stay under 10 per cent if the lockdown remains at four weeks and the Government provides additional financial support. This rises to 13.5 per cent without new support measures. Under grimmer scenarios, if the lockdown were to be extended unemployment could reach between 17.5 and 26 per cent. A figure of 10 per cent would mean 275,000 Kiwis out of work.
Support for the Prime Minister's swift action to move New Zealand to a lockdown state under alert level 4 has so far been strong. Most Kiwis have been happy to stay in their bubbles, playing their part in a coronavirus response which has gained international recognition.