Australia’s coronavirus death toll remained relatively low compared to most other countries in Europe and Asia, possibly helped by its low population density, isolation as an island state, and good public healthcare. However, the effect on Australia’s economy was not vastly different from other similar economies. Hardest hit were the hospitality, entertainment, arts, and retail industries, which reported job losses in the hundreds of thousands. As domestic and international travel was restricted, Australians canceled their travel plans en masse, with devastating results for the tourism industry both within the country and abroad. In March, the major travel agency chain Flight Centre announced that 3,800 jobs would be stood down, and in the following month, Virgin Australia Airlines went into voluntary administration.
From early March, the Australian government implemented social isolation measures and widespread restrictions on the operations of most food and service businesses. This was followed by temporary closures of public spaces like beaches and popular meeting places. As the number of coronavirus cases continued to rise towards the end of March, the states and territories restricted domestic visitors, and testing for the virus increased across the country. By the end of April, these efforts to flatten the curve appeared to have been effective, and the process of relaxing restrictions began.
Following Australia’s first wave of coronavirus cases, the island nation appeared to be on track as one of the world’s coronavirus success stories, much like its neighboring New Zealand. Australia and New Zealand had even begun discussing the possibilities of a “trans-Tasmin travel bubble” whereby residents of both countries could travel between the two nations without undergoing mandatory quarantine. However, these plans were soon put on hold when COVID-19 cases in Victoria began to rise again. Following this increase in cases, Australia experienced a second wave of infections that would prove to be more devastating than the last, with a higher rate of locally transmitted infections and significantly more deaths. State boarders were once again closed, and the Victorian government implemented stage four lockdown restrictions in Melbourne and stage three in the rest of the state.
Although Australia’s social and trading restrictions were not as strict or long-lasting as many other countries, the long-term economic effects were evident early on. The education sector, which earned over 12 billion Australian dollars from Chinese students alone in 2019, began the first semester of 2020 without hundreds of thousands of international students, who were unable to enter the country due to travel restrictions. Panic buying saw an initial rise in sales in March, particularly in groceries and essentials, but retail suffered a never before seen month-on-month fall in sales in the following month. Aside from the reduction in turnover and reduced demand for products, many businesses also reported disruptions to their supply chain. However, some were able to adapt by adjusting their business model or shifting to online platforms, and demand for a small number of services, like home delivery and takeaway, actually increased dramatically.