INTHEBLACK October 2021 - Magazine - Page 53
R E C O V E RY
TYPES
S P E L L E D O U T:
K-shaped
One segment of
the economy
booms, while
another suffers.
V-shaped
Typified by a sharp
decline, but a fast
recovery.
U-shaped
A longer period
between decline and
return to normal.
L-shaped
A pessimistic
scenario, defined
by prolonged and
sustained downturn.
W-shaped
Also known as
a double-dip
recession, it features
two declines.
A NEW
APPROACH TO
LOCKDOWNS
DANIEL WILD
DIRECTOR OF RESEARCH,
I N S T I T U T E O F P U B L I C A F FA I R S
T
he main inequality division that we’ve seen throughout the
lockdown period has been between the public and private sector,
where there has been a significant growth in the number of jobs and
wages of public sector workers, but a fairly significant decline in jobs
and wages in the private sector.
In Victoria, in the second lockdown last year, private sector
wages went down by about A$3.5 billion in total, whereas public
sector wages increased by about A$660 million, so there’s a very
significant divide.
The situation has also created a moral hazard, because public
sector workers are largely responsible for the advice on how to
respond to COVID-19 and its implementation, yet it’s often the
private sector workforce that incurs the costs of lockdowns.
The second division is between big and small business. Again, it’s
largely been smaller businesses that have disproportionately suffered
the negative implications of lockdowns, whereas bigger businesses
tend to be better capitalised, have a stronger cash flow and are able
to offer home delivery.
The point is that the pandemic is going to be with us for another
couple of years, so we need to have a different strategy for managing
COVID-19, in part because of the economic and humanitarian costs.
Our team has advocated an approach that’s risk-based,
proportionate and targeted. Rather than having city-wide and
state-wide lockdowns in response to a handful of cases per day, you
dedicate your resources to ensuring the safety of those who are most
vulnerable and those who are in the worst health – typically the
elderly – and you have a bias towards allowing economic, social and
recreational activity to continue.
At the moment, the presupposition is that everything will be
stopped subject to special exemptions, whereas we think it should
be the opposite approach.
MEET THE
EXPERTS
DANIEL WILD
Daniel Wild is the director
of research at the Institute of
Public Affairs. He specialises
in red tape, regulation,
economic policy, the
philosophy of free enterprise
and criminal justice.
JACOB ALDRIDGE
Jacob Aldridge is an
entrepreneur, speaker and
international business adviser
who has helped hundreds
of businesses implement
commercial and cultural
growth management systems.
JEREMY BRITTON
Jeremy Britton is a US-based
financial adviser, economist
and best-selling author. He is
the CFO of BostonCoin, the
world’s first diversified crypto
mutual fund.
M AY S A M A L I
May Samali is an Australian
John Monash Scholar and
the founder of Coaching
by May, a professional
leadership and personal
development service. She
holds a masters in public
policy from the Harvard
Kennedy School, a bachelor
of law and a bachelor of
economic and social sciences
from University of Sydney.
intheblack.com October 2021 53