As countries across the globe grapple with the prospect of renewed lockdowns, the Australian city of Melbourne offers a stark lesson on the costs of bringing the coronavirus under control.
The city of 5 million people on Wednesday emerged from one of the world’s strictest and longest lockdowns that shuttered businesses and confined residents to their homes for more than three months.
While infections have dropped from a daily peak of about 700 in early August to just two new cases on Wednesday, the economic and social impact of Melbourne’s second lockdown since the crisis began has been enormous. Australia’s government estimates 1,200 jobs have been lost on average a day across Victoria state, while demand for mental health services has surged by more than 30%.
Despite key factors working in Melbourne’s favor, including closed borders, an infection count that was tiny by international standards, and a state government with strong public backing, it still took twice as long as anticipated to crush the curve.
It’s a bleak reality confronting political leaders, particularly in Europe, who have already experienced the damage wrought by full-blown lockdowns and are now weighing options to fight a resurgence of the pandemic. German Chancellor Angela Merkel, for example, is pushing for tougher curbs on movement and contact, including closing bars, restaurants and leisure facilities until the end of November, according to a draft federal government briefing paper obtained by Bloomberg.
Australia was in the vanguard of nations that had early success in controlling community transmission. Its first nationwide lockdown, which lasted roughly from March to May, reduced the number of cases to just a handful a day.
But security failures at quarantine hotels for returning overseas travelers, poor communication of critical information to migrant communities and inadequate contact tracing allowed the virus to roar back in Victoria.
On July 7, state Premier Daniel Andrews announced a six-week lockdown, ordering Melbourne residents to stay home except for essential work and services, medical treatment, school or an hour’s exercise a day. Less than a month later, as cases continued to rise, the restrictions were extended across the entire state, Melbourne was placed under a nighttime curfew, schools were closed and large parts of retail, manufacturing and hospitality were shut down.
With Victoria accounting for about a quarter of the nation’s gross domestic product, the restrictions have deepened Australia’s first recession in almost 30 years.
The lockdown has slashed A$100 million ($71 million) a day from economic activity and through August and September resulted in a daily average of 1,200 jobs being lost across the state, Luke Yeaman, a Treasury department official, told a parliamentary panel this week.
Long Recovery
Business leaders say it may take years for Melbourne -- ranked as the world’s second-most livable city last year -- to recover. Melbourne chef Scott Pickett warned that ongoing capacity restrictions would continue to hit restaurants and cafes and that many would fold once government wage subsidies end early next year.
“Some may get to Christmas, January and say they can’t do this anymore,” said Pickett, who owns the bistro Estelle. “It’s going to be a bloodbath out there at some stage.”