Riverina business groups say Wagga employers are looking to hire more people as confidence builds and the Christmas shopping season approaches.
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The latest JobSeeker numbers show an increasing number of people have stopped claiming unemployment payments over the past three months.
The August lockdown for regional NSW, due to the COVID-19 Delta variant outbreaks, saw 330 people return to the Centrelink queues across the Riverina, including more than 140 in Wagga.
The past three months have almost wiped out that backward step in the region's economic recovery, with JobSeeker numbers suggesting that a net 100 people entered Wagga's workforce during October.
Wagga Business Chamber business manager Serena Hardwick said it was a good sign that unemployment was continuing to drop. "It's not slowing down.
"People are starting to put on Christmas casual workers and I think retail is getting ready for a bumper season," she said.
Ms Hardwick said some industries in the city, such as hospitality, were now facing a workforce shortage.
"There are a lot of vacancies, the December 15 mark has given businesses the confidence they need to make long-term decisions about recruitment and employment at the moment, which is something they haven't had," she said.
"I think we'll see a significant change after the 15th as we have had COVID-19 cases and we haven't been locking down, which has been an issue for businesses in the past as they didn't want to hire staff in case they had to put them off during a prolonged lockdown."
NSW plans to remove the requirement for shoppers and hospitality patrons to wear masks on December 15, or earlier if the 95 per cent full vaccination milestone is reached.
Business NSW Murray-Riverina regional manager Anthony McFarlane also said the end of the mask rule would be an important psychological milestone for businesses and shoppers.
"It's a small thing but I think it's a big signal. It's one of those comforts we have taken for granted. It will be welcome as the weather gets warmer and it's symbolic of moving through the recovery timeline," Mr McFarlane said.
Mr McFarlane said Wagga should be back to its pre-pandemic employment level within a couple of months. "The labour market is going to get more and more competitive and we may see some wage pressures and further incentives for people to come back into the workforce," he said. "Confidence is recovering well and we look forward to strong trading conditions into the summer."
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