NS Group Pandemic Series No. 2: Economic life support through COVID-19 /

Conjecture around the COVID-19 transmission curve flattening leads us to wonder what the eventual drop-off in new cases will mean for the economy. Who holds the economic antibodies in a pandemic and will those who are ‘high risk’ survive?

Based on ABS statistics, AMP Capital [1] is modelling that the effects of COVID-19 plus governmental distancing restrictions in Australia will result in:

  • 60% of our economy taking a medium to large hit
  • 24% will likely be neutral or slightly impacted
  • 16% are set to receive a boost
AMP Capital COVID-19 Impact to Australia's GDP

Source: AMP Capital [1]

In times of crisis, society naturally looks to similar historical events to help us contextualise the landscape.
Comparing previous major economic and pandemic [2] crises, including the Spanish flu, the GFC and the Great Depression, all of these social and economic catastrophes had lasting impacts on government fiscal policy, social demographics and economy hierarchies – both locally and globally.
Resilient sectors during this pandemic will be those coordinating health and related services, facilitate the setup and maintenance of de-centralising business headquarters, and the governmental rollout responses. Core services, such as transport (with the exemption of travel) and resources, will understandably be safeguarded by necessity. The (hopefully) short-term brunt of the impact from immobilising our community, closure of borders and market instability will be worst felt by housing, retail, travel and the arts.
However, many experts believe that the impending recession, or bear market, won’t last long. If the global pandemic and local economies are effectively managed, the negative impacts of COVID-19 will be experienced across one to two quarters with a swift rebound to follow – and we have reason to feel confident of this in Australia. Other countries and economies will vary depending on their domestic situation, core industries and societal fabric.
The International Monetary Fund [3] anticipates there will be a global recession in 2020, but world economic output should recover in 2021 .
The unparalleled level of fiscal stimulus being applied across the world, and locally in Australia, will hopefully support these theories. While the world average stimulus is approximately 2.5% of GDP [1], Scott Morrison’s announcement of a third stimulus package brings the total in Australian Government [4] spending to $320 billion – a massive 16.4% of GDP.

AMP Capital G20 Countries Fiscal Thrust

Source: AMP Capital [1]

Consequently, while COVID-19 hurts, the extraordinary level of government support in Australia will hopefully mean that this is short-term pain and Australia will be back on track in 2021. 
It’s true that while $320 billion is a substantial sum, the Government’s initiatives have concentrated on economic protection, keeping our mortgages intact and the workforce available for a quick recovery. 
As with the Great Depression and the GFC, the stimulus and investment continued beyond the initial recovery, concentrating on national strengthening projects bringing back personal wealth to the worker and emotional recovery to the community.
The Government will therefore need to increase its commitment to longer-term economic infrastructure initiatives through a fourth stimulus package boosting those industries worst hit, such as residential, retail and tourism. 

NS Group is researching and workshopping the likely infrastructure-related initiatives that will be instigated and how the property industry will be best placed to provide support.

Next issue: In the following edition of NS Group’s ‘Pandemic Series’, we’ll share our insights into where money might flow and how to take advantage of the opportunities that may come.


NS Group is a market leader in the property and construction industry, helping clients to re-imagine the future of their new and existing portfolios in support of their business’ goals. While COVID-19 has created uncertainty around what happens today, tomorrow and into the future, we do know that time waits for no one.

As industry leaders and guided by our purpose to ‘connect, empower and lead people to create great places’, it’s in our DNA to assist in any way that we can. Therefore, we’ve tasked ourselves with taking the time to review the situation, understand the facts, provoke thoughts and guide action so that we all make our way out of this together.


  1. https://www.amp.com.au/insights/grow-my-wealth/is-coronavirus-driving-a-recession-depression-or-an-economic-hit
  2. https://www.visualcapitalist.com/history-of-pandemics-deadliest
  3. https://www.imf.org/en/News/Articles/2020/03/23/pr2098-imf-managing-director-statement-following-a-g20-ministerial-call-on-the-coronavirus-emergency
  4. https://treasury.gov.au/sites/default/files/2020-03/Overview-Economic_Response_to_the_Coronavirus_1.pdf

Disclaimer: NS Group’s ‘Pandemic Series’ is a thought piece. The information provided has been sourced and collated from various online resources and is correct as at the date of release. This information is intended to serve as general information purposes only. NS Group does not guarantee, and accepts no legal liability whatsoever arising from, or connected to, the use of this information or from any linked site. We recommend that you seek appropriate independent professional advice before making any decisions based on the information provided.