SYDNEY, AAP – While economic growth in NSW is reliant on COVID-19 case numbers dropping, the state’s chief economist says he’s hesitant to declare a recession is imminent.

Recent data showed that at least 36,000 jobs were lost in NSW since COVID-19 lockdowns began in mid-June, with a seven per cent drop in hours worked in July.

But the contraction for NSW and Victoria last year as coronavirus lockdown restrictions were first implemented was greater, chief economist Stephen Walters said.

Mr Walters and NSW Treasury secretary Michael Pratt AM were quizzed in a parliamentary inquiry on Friday on the economic effect of the outbreak, and lockdowns nearing eight weeks.

Mr Walters said he was reticent to say the economy would enter a recession for technical reasons – consecutive quarters of economic contraction.

“We don’t get gross state product on a quarterly basis, so we would never actually know in NSW,” he said.

He did acknowledge Australia experienced negative consecutive quarters last year and said it was widely accepted as a recession.

But he remained hopeful that the state could bounce back, dependent upon COVID-19 numbers dropping.

“When restrictions were eased (last year) we saw that the economy recovered very very quickly,” Mr Walters said.

There were no figures to specify how many of the current job losses have occurred in the 12 local government areas of concern in southwest and western Sydney.

The NSW government has copped criticism regarding significant delays in handing out welfare to businesses in need of emergency funding.

Shadow treasurer Daniel Mookhey called the grants and JobSaver initiatives a debacle and said he had been inundated by small businesses complaining about their inability to access them.

Mr Pratt said real progress had been made after Customer Service Minister Victor Dominello apologised earlier this week for the quality of service that was “not up to standard”.

For emergency grants programs including JobSaver, about $1.6 billion has been paid to businesses so far, Mr Pratt said. This is funded 50-50 by the state and Commonwealth

“There is a huge commitment within customer service to get on top of this and manage the backlog,” Mr Pratt said.

Mr Pratt said he asked the federal government for JobKeeper to be reinstated as the COVID-19 outbreak escalated in Greater Sydney, but that was refused.

The JobSaver program costs $500 million per week and has currently paid out just over $700 million.

As payments began on July 18, Mr Mookhey pointed out there was also a significant gap in those payments being transferred into bank accounts.