Interest rate rise costs more people their jobs

Today’s interest rate rise will cause more people to lose their jobs and the RBA must pause raising rates, says ACOSS.

Even prior to today’s announcement unemployment was set to rise to 4.5% by July 2025. That’s equal to an additional 130,000 people forced out of paid work. Every additional interest rate rise leads to job losses down the line.

ACOSS Deputy CEO Edwina MacDonald said: “Inflation is a serious challenge that needs to be tackled but without deliberately tanking the economy and driving people out of work.  

“We welcome the government’s commitment to reforming the RBA so it gives equal weight to inflation and full employment when setting interest rates – but this change can’t come soon enough.

“Instead of relying on the blunt tool of interest rate hikes, the government should be tackling inflation directly by better regulating the rental market and taking further action to reduce energy and healthcare costs.

“We also urge the government to take further urgent action to assist those on the lowest incomes who are forced to go without food and medication due to rising cost pressures and the inadequate income support rate.

“This latest decision demonstrates why the RBA desperately needs more diversity on its board, including a member focusing on people locked out of paid work.”

ACOSS is calling on the government to:

  1. Strengthen the role of the ACCC to tackle inflated market pricing.
  2. Work with the states and territories to implement better regulation of the private rental market to protect against exorbitant rent increases.
  3. Take further action to reduce energy costs and bills, including extending the cap on wholesale gas prices to 2025, fixing the setting of the Default Market Offer to better balance energy retailer profits with pricing for this essential service, and invest further to make homes energy efficient and electric for people on low incomes.
  4. Lift Jobseeker, Youth Allowance, and related payments to at least $76 a day. Following the recent Federal Budget, JobSeeker will still only be $53.85 per day when it is increased in September, with Youth Allowance just $42.85 per day.