COVID-19 has started an economic tsunami that threatens to overwhelm progress towards reducing disadvantage across New South Wales. This report provides estimates based on international, Australian and original research on the impact of rising unemployment on disadvantage across NSW’s regions.

Already there is evidence the pandemic and associated lockdowns have increased rates of domestic violence, mental distress, housing stress and hurt the academic performance of disadvantaged children. Analysis undertaken for this report shows rates of reported domestic violence increased between May and June 2020 by up to 41 per cent in some regions of NSW compared to the same period in 2019.

But more challenges lie ahead, with Equity Economics forecasting unemployment to peak in NSW at 9.5 per cent in January 2021. Importantly, there will be large geographic variation in the increase in unemployment, with many regions across the state experiencing double digit unemployment.

The report focuses on five key domains of disadvantage: housing, domestic violence, child protection, mental health and education.

The modelling in this report provides a warning of what might occur without further strengthening of social and family support services in NSW. Meeting the projected wave of disadvantage head on will require additional government support, services and collaboration. We identify key priority areas for investment: Aboriginal and Torres Strait Islander community controlled organisations to improve the wellbeing of Indigenous communities; services that address housing stress and homelessness including a social housing infrastructure program; early intervention and prevention services to support families and keep children and young people safe; crisis accommodation and other supports for women and children leaving violence; community based mental health services; and additional funding for low socioeconomic children in schools.