Yes, Everyone Really Is Sick a Lot More Often After Covid.
Around the world, people really are getting sick more often than before the pandemic.
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I am Leon Gettler. My job is to review and monitor the week’s news in business, finance and economics. I bring it all to you, every week.
This is episode number 21 in our series for 2024 and today’s date is Friday June 21
And that’s it for this week. And next week, I’ll be talking to Anthony McClure, the managing director of Silver Mines. We’ll talk about how silver is a vital component in solar photovoltaic (PV) panels enabling efficient capture and conversion of sunlight into electricity thanks to its unsurpassed electrical conductivity and how silver’s high conductivity and ductility make EVs more efficient by establishing lightweight but strong electrical connections between batteries and other car components.
And I will talk to Indeed economist Callam Pickering about the latest unemployment figures.
But first, let’s talk to Anthony McClure
So what’s happening in the news?
Yes, it’s happening, around the world, a post-COVID reality is beginning to sink in: Everyone, everywhere, really is sick a lot more often. At least 13 communicable diseases, from the common cold to measles and tuberculosis, are surging past their pre-pandemic levels in many regions, and often by significant margins, according to analysis by Bloomberg News and London-based disease forecasting firm Airfinity Ltd. The resulting research, based on data collected from more than 60 organizations and public health agencies, shows that 44 countries and territories have reported at least one infectious disease resurgence that’s at least ten times worse than the pre-pandemic baseline. The post-Covid global surge of illnesses — viral and bacterial, common and historically rare — is a mystery that researchers and scientists are still trying to definitively explain. The way Covid lockdowns shifted baseline immunities is a piece of the puzzle, as is the pandemic’s hit to overall vaccine administration and compliance. Climate change, rising social inequality and wrung-out health-care services are contributing in ways that are hard to measure. Covid-19 is the first major global pandemic in the era of modern medicine, so there’s little precedent for what comes after. “The last major devastating flu pandemic was in 1918. There was no vaccination, no diagnostics or treatments. So we are in a new territory here,” said Jeremy Farrar, World Health Organization’s chief scientist. Influenza cases in the US have jumped about 40% in the two post-Covid flu seasons, compared with the pre-pandemic years, according to clinical lab results. Whooping cough, or pertussis, cases have climbed 45 times in China in the first four months compared with last year. And in some parts of Australia, where flu season is just getting underway, cases of respiratory syncytial virus, or RSV, have nearly doubled from a year ago. Argentina is battling its worst-ever dengue outbreak. Japan is seeing a mysterious surge of Streptococcal A, also known as strep throat. Measles is making a comeback in more than 20 American states, the UK and parts of Europe. Globally, 7.5 million people were newly diagnosed with tuberculosis in 2022 — the worst year on record since the World Health Organization started global TB monitoring in the mid-1990s. The theory of immunity debt has become a popular, if controversial, explanation for the post-Covid surge in illnesses. It basically means that pandemic lockdowns offered an artificial layer of insulation from routine pathogens but left people more vulnerable when the world reopened. The effect is worse for young kids, whose brand-new immune systems were cosseted by social distancing, online classes and masks. Public health experts aren’t convinced. Immunity debt might account for some resurgence of illnesses reported post-Covid, but probably not all of it. A sustained rise in mortality levels in some countries is fuelling another theory, that pandemic lockdowns essentially kept some people alive who may have died in a normal environment with freely-circulating viruses and bacteria. Canada, Japan, Singapore and Germany — places lauded for their successful efforts to contain Covid — are now seeing unusual levels of excess mortality. Then there’s the unquantifiable role of poverty, which has spiked globally in the aftermath of the pandemic. Social inequality is the “biggest risk factor” for infectious disease, said David Owens, co-founder of OT&P Healthcare in Hong Kong. Overcrowded living conditions and poor access to high-quality nutrition adds to illness, increasing the amount of viral and bacterial pathogens in societies. And the ensuing strain on public health-care systems drags down the quality of care for everyone. At the same time, a growing number of children live in conflict or fragile environments, limiting ready access to vaccines. And Covid-era misinformation fueled simmering mistrust in vaccines in general. The state of constant illness already is taking a toll on businesses and the economy. Nearly one in three US employees in white-collar jobs took at least one sick day in 2023, according to payroll company Gusto, up 42% from 2019. And when they missed work, they missed more of it, with the average absence up 15%. And a UK study found workplace absences at the highest rate in over a decade, with employees missing nearly eight days on average over the past year, up from six before the pandemic. The surge in RSV, influenza, whooping cough and even the common cold is taxing public health resources. Despite the speed with which countries around the world left Covid-era protections behind, the lingering trail of sickness, along with the thousands of COVID deaths each month, shows that the pandemic has cast a long shadow.
The Reserve Bank of Australia board has warned that recent big-spending federal and state budgets may have added fuel to the inflationary fire as it held rates steady at 4.35% for a fifth straight meeting and said it will “do what is necessary” to bring price growth back under control. The board’s statement, issued following the end of the two-day meeting, said “inflation is easing but has been doing so more slowly than previously expected and it remains high”. “While recent data has been mixed, they have reinforced the need to remain vigilant to upside risks to inflation. The path of interest rates that will best ensure that inflation returns to target in a reasonable time frame remains uncertain and the board is not ruling anything in or out,” the statement read. Australian Treasurer Jim Chalmers has insisted that the May budget’s extra $9.5bn in spending in 2024-25 would not make it harder for the RBA to bring inflation back under control, and boasted that handing out energy bill subsidies to every household would lower the measured rate of consumer price growth. Queensland’s Labor government, facing an election defeat in October, promised in its recent budget an incredible $11.2bn in subsidies, rebates and discounts in 2024-25. The RBA board’s statement, for the first time, signalled a growing uneasiness among officials that generous federal and state cost of living support was working against monetary policy. “Recent budget outcomes may also have an impact on demand, although federal and state energy rebates will temporarily reduce headline inflation,” the statement said.
The Albanese government will introduce laws to split the CFMEU and allow its manufacturing division to leave the union in response to John Setka’s war with the AFL over the past week. Workplace Relations Minister Tony Burke will introduce the bill soon after parliament resumes next week to allow manufacturing to exit if it has support from a ballot of members in a move likely to fuel tensions between Labor and the CFMEU’s Victorian construction boss. It follows Prime Minister Anthony Albanese and Mr Burke clashing with Mr Setka over his threats to disrupt AFL projects unless the league sacks its new umpires chief Stephen McBurney because he once headed the former Australian Building and Construction Commission. While Labor has been working on legislation to allow this for weeks, Mr Setka’s recent behaviour is understood to have hastened the move. Mr Burke said that the bill would provide the same opportunity to manufacturing as the CFMEU’s former mining division, which used Coalition laws to hold a ballot of members and form its own union. “We will provide the opportunity for members of the manufacturing division to vote on their future because the status-quo is dysfunctional and cannot continue,” he said. “The members in the manufacturing division include workers in largely feminised industries like textiles – and it’s not hard to see why those members might want to vote to leave.” The CFMEU manufacturing division has wanted to demerge since Mr Setka turned on its secretary Michael O’Connor in 2020 when he failed to support the Victorian union chief over domestic violence charges. ACTU secretary Sally McManus backed the government’s move as “there are unique circumstances at the CFMEU” and criticised Mr Setka’s approach.
Peter Dutton has told his Coalition colleagues he will go to the next election promising to build seven nuclear power stations. Mr Dutton will promise the first sites can be operational between 2035 and 2037, several years earlier than the timeframe the CSIRO and other experts believe is feasible. As had been previously flagged, the stations are all on retiring or retired coal sites.
The seven sites are:
- Tarong in Queensland, north-west of Brisbane
- Callide in Queensland, west of Gladstone
- Liddell in NSW, in the Hunter Valley
- Mount Piper in NSW, near Lithgow
- Port Augusta in SA
- Loy Yang in Victoria, in the Latrobe Valley
- Muja in WA, near Collie
Five of the seven are in Coalition seats: Muja in Rick Wilson’s seat of O’Connor, Loy Yang in Darren Chester’s seat of Gippsland, Port Augusta in Rowan Ramsey’s seat of Grey, Callide in Colin Boyce’s seat of Flynn and Tarong in Nationals leader David Littleproud’s seat of Maranoa. Mount Piper is in the seat of Calare, held by independent Andrew Gee who was elected as a Nationals MP in 2022 but quit the party. Liddell is the only site in a Labor seat, the seat of Hunter, held by Labor’s Dan Repacholi. In a press release, Mr Dutton and colleagues said the locations offered “important technical attributes needed for a zero-emissions nuclear plant, including cooling water capacity and transmission infrastructure, that is, we can use the existing poles and wires, along with a local community which has a skilled workforce”. The SA and WA sites are tapped as suitable for small modular reactors only, with the other five slated for either small reactors or larger-scale plants, depending on what is deemed to be “the best option”. Mr Dutton has indicated a 2035 start date if small modular reactors are chosen and 2037 if larger plants are chosen. The Coalition is proposing that the government should partially fund the plants in partnership with “experienced nuclear companies” and then own the plants in a similar model to Snowy Hydro and the National Broadband Network. But further funding details have not been announced, including the total cost. Mr Dutton said “comprehensive site studies” would be needed before that price tag could be revealed. The Coalition has been promising details of a nuclear policy, including specific sites and funding details, for several months amid expert concerns over the cost and timeframe.
Rising wages, increased demand for materials and workers from housing, health, energy and defence projects and a transition to lower-carbon alternatives is driving inflation higher again in infrastructure, a new Oxford Economics Australia report says. Cost escalation that soared as much as 10% year-on-year in sectors such as roads and ports amid post-pandemic global pressures had come off but was now again picking up due to increasing domestic demand, even as consumer inflation was likely to remain subdued, the report says. A ramp-up of home-building in the second half of the decade will challenge infrastructure projects for workers and materials, along with upcoming enterprise bargaining agreements that would lock in higher wages as well as higher costs of still-new greener technologies, it says. “There may be a misconception out there that the cost of infrastructure should be falling but in fact, it’s not,” said Adrian Hart, Oxford Economics Australia director of construction and infrastructure. “It continues to grow above the cost levels that were experienced during the COVID-19 and energy crises.” Cost escalation fell as low as 2.6% last year in some sectors but will pick up again in a booming infrastructure market, the consultancy’s Construction Costs and Inflation report says.
Bupa has signalled its intention to buy and build a national network of healthcare centres providing GP services, allied health and pathology, as the insurer seeks to further broaden the services it offers. Bupa APAC chief executive Nick Stone said the strategy would be rolled out over the next few years, with two pilot centres already operational. The insurer will initially focus on buying existing centres, with greenfields developments also envisaged as part of the strategy. The centres will be open to the general public as well as Bupa customers, with Mr Stone saying the vision was to provide a better service for customers and also take costs out of the healthcare system. The centres would be targeted at areas convenient to customers, within about 15km from most customers, and were part of the insurer’s broader Connected Care strategy, which includes a door-to-door chemist delivery service, virtual doctor consultations and online health tools. The insurer is focusing heavily on type 2 diabetes, mental health, musculoskeletal health and oral and eye issues as areas where it can make a difference, using a suite of digital tools and physical centres. Mr Stone said a more integrated combination of virtual tools, including access to doctors, as well as the new centres, would take a lot of friction out of the healthcare system, while also providing better outcomes for patients. “Maybe the first step in some cases – so you’ve gone into a virtual consult, you work out that you might need a physical GP consult so you go from there into one of the health hubs,” Mr Stone said. “That health hub is going to have access to, obviously, GPS, nurse-led care, for more general things like immunisations and so forth, pathology as well. And other services that we’re looking at to offer in these health hubs are things around psychology, physio and dietitian-type services as well.” Mr Stone said a more seamless process for customers would ultimately lead to better clinical outcomes and also cost savings for the health system.
ASIC’s latest insolvency figures indicate there were a total of 9,996 companies that had entered external administration or had a controller appointed at 2 June this year. The insolvency figures for the 2023-24 financial year so far are already around 25% higher compared with the figure for the entire 2022-23 financial year. They also remain well above the base level average of the 2017, 2018 and 2019 income years which was 7,939. CreditorWatch chief economist Anneke Thompson said data from the latest CreditorWatch Business Risk Index pointed to “ever increasing stress levels in the Australian business sector”. Thompson said it was clear that cash flow issues were also starting to permeate through the Australian small business sector. Construction remains the sector with the highest number of insolvencies at 2,711 this year so far, followed by accommodation and food services at 1,498. The rate of insolvencies in agriculture, forestry and fishing sectors have almost doubled from last year, increasing around 89%. Other services also saw a rapid rise in insolvencies with the number of insolvencies increasing by around 51% from the 2022-23 year. This was followed closely by professional, scientific and technical services with a 49% increase in the number of insolvencies. ASIC had previously warned that insolvencies would likely reach 10,000 by the end of the financial year back in April. “With only one quarter remaining this financial year, it’s expected that the number of companies entering external administration by 30 June 2024 will exceed 10,000,” the regulator said. It said the surging levels of company failures had not been seen since the 2012–2013 financial year, when 9,254 companies entered external administration.
Australian gambling services firm Tabcorp Holdings has appointed former Australian Football League (AFL) boss Gillon McLachlan as its chief executive and managing director. The appointment comes months after former chief Adam Rytenskild resigned over allegedly using “offensive” and “inappropriate” language at the workplace and as the firm navigates a strategic transformation amid heightened competition pressures. McLachlan was the AFL chief executive for a decade during which he contributed to significant revenue growth and oversaw its expansion. He will join Tabcorp on Aug. 5 and assume the roles of CEO and MD upon receiving regulatory approvals, the company said. Now that is on top of his other job as external advisor to Blackstone, the world’s largest alternative asset manager and owner of Crown Resorts. And by the way, there is a connection. McLachlan and Blackstone’s Australia and New Zealand chairman of private equity James Carnegie are, coincidentally, first cousins. Fancy that. Their mothers (Sylvia McLachlan nee Clarke and Carmen Clarke are sisters. Conflicts aside, at Tabcorp, McLachlan will receive an annual fixed remuneration of $1.5 million. In recent years, Tabcorp — despite enjoying retail exclusivity — has lost significant market share to its competitors during a time of seismic change to digital wagering, which was only accelerated during Covid-19. But for all the opportunity that comes with the job, McLachlan takes the reins at arguably the most challenging time in wagering history, with a range of headwinds, some self-inflicted and some not, conspiring against Tabcorp. Clawing back market share and growing revenue has never been more difficult, with how you can procure customers — given the significant restrictions around incentives and inducements — never more stringent. And the impost of regulations will soon become even more onerous as the wagering sector awaits the Government response to its inquiry into online gambling.
And that’s it for this week.
And next week, I’ll be talking to Scott O’Neill, the founder and director of Rethink Investing, a Sydney-based company which started out as a commercial property buyers agency which has now become a national company that also works as a residential buyers agency, a property law advisory agency, mortgage broking and finance company.
And I will talk to EY economist Cherelle Murphy about Australia’s latest inflation figures and what these mean for interest rates.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website leongettler.com.
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Wishing you all a safe and healthy week, And looking forward to bringing you Talking Business next week
