Banjo was delighted to have recently hosted an exclusive client webinar, featuring David Robertson, Head of Economic and Market Research at Bendigo and Adelaide Bank, a valued Banjo partner. This is a snapshot of David’s webinar, three months on from his last one.

This has been the deepest contraction in Australia in living memory, but the good news is we are on a slow path out of the recession. With Melbourne/Victoria on a slower trajectory due to their second wave of COVID, this means it’s likely to be more of a W-shaped recovery overall.


There were 13 million employed Australians just before COVID. This fell to 12.1 million at the height of the crisis in April/May and is now back to 12.46 million. The industries that are suffering the most are hospitality, the arts and recreation.

International trade

China has been first out of the downturn, with a classic V-shaped recovery, which is now well-entrenched. Indirectly this is good for Australia, since they are our strongest trading partner. Despite the well-publicised barley/wine/beef export issues, Australia has been trading at record highs with China on commodities, especially iron ore and gold.

Government support 

Australian fiscal support packages have buoyed spending and lessened the impact, with Jobkeeper and Jobseeker instrumental in helping the economy. It’s paid for by federal government debt through quantitative easing, but the good news is Australia can easily afford it.  Government bonds are the cheapest they’ve ever been. 

Our gross debt to GDP has gone from around 30% to 35% and is forecast to reach 45% by early next year. As a triple A rated country, this is not a problem, and the RBA will be comfortable with 50%. 

By comparison, the US debt level to GDP is 110%!

Consumer spending and property

Remarkably, retail sales are 12% higher today than they were a year ago. As a nation, we’re spending more on food and household goods, than this time last year.  Other than Victoria, restaurant bookings around the rest of the country are higher today than a year ago. 

There is a change in preferences around how we shop. Spending in stores other than department stores, has increased. 

Australian consumer sentiment has followed a W shape, but business confidence is rebounding well.

The owner occupied housing market is holding up very well, although the investor side is under stress. In some capital cities – Hobart, Adelaide, Canberra – prices have hit record highs, while the other capital cities fell by over 1%. Demand for regional property has also been very high, and prices there have risen on average 0.3%. Working from home has proven to be quite effective, and so far we have proved that the technology can support it. 


Stock markets have recovered well already. Investors are looking at long term – 4 to 5 years of performance – and are expecting a return to profitability. We are now in a new general multi-year up-trend from here. 

Commodity markets have bounced back strongly. In agriculture the drought has generally broken. There are no signs of inflation. However, early withdrawals from super are a bit worrying for the long term. 

We are in the midst of the greatest technological revolution in history, and there is a lot of confidence that it will accelerate. The Australian AllTech Index is powering ahead.

The outlook for SMEs

With SMEs, David suggests there is a diverse range of outcomes based on location or industry, resulting in a K-shaped recovery. Some businesses are recovering nicely and will continue to do so, while some others won’t get back on their feet.   

Larry Fink, CEO of Blackrock recently said, “People worldwide are fundamentally rethinking the way they work, shop, travel and gather. When we exit this crisis, the world will be different.”

For SMEs, the businesses that can best thrive will be those who rapidly adapt to the post-pandemic society. So now is the time to invest in technology and innovation, especially with interest rates so low. 

There are also lots of opportunities to take advantage of all the government incentives currently available to support businesses.