Scott Morrison has urged Australians not to let shocking unemployment figures break their hearts, but also cautioned not to underestimate the task of rebuilding the economy.

The prime minister flagged Australia may have to live with the coronavirus for years, saying it was vital to work out how to keep the economy moving.

Australia has recorded about 6975 cases of the virus, with more than 600 people not yet recovered.

The number of people in hospital with coronavirus has dropped nine-fold since early April.

But while the health figures are encouraging, the latest unemployment numbers from the Australian Bureau of Statistics show nearly 600,000 people lost their jobs between March and April.

“These are families, these are friends, these are neighbours, these are workmates,” Treasurer Josh Frydenberg told reporters on Thursday.

Another six million workers are now covered by the JobKeeper wage subsidy scheme, including many who have been stood down from their jobs but aren’t officially counted as unemployed.

Mr Morrison said it was important people support each other and seek hope in the prospect of a recovery.

“Almost 600,000 Australians losing work can disappoint that hope, it can break hearts,” Mr Morrison told reporters.

States and territories have started moving into the first of a three-stage process of lifting restrictions.

It’s anticipated 850,000 people will be back at work by the time the third stage is reached in July, although this includes people stood down on JobKeeper.

Mr Morrison said people should not underestimate the scale of the task to reopen the economy.

“It’s one thing to close things down, it’s entirely another to open them up again and to do so in a COVID-safe way,” he said.

“The task we have now is to reopen those businesses, to get employees back into their jobs and to do so in a COVID-safe way so that it’s sustainable for many years potentially if that is what is required.”

The attention of officials is turning to the mental health fallout from Australians having spent so long in isolation from friends and family.

A new deputy chief medical officer has been appointed to deal with mental health ahead of the national cabinet on Friday approving a plan to boost support services.

Just as the government got “ahead of the curve” with the virus, Health Minister Greg Hunt says former Victorian chief psychiatrist Dr Ruth Vine will play a crucial role in heading off major problems with mental health.

With the disruptions to schooling around the nation, the federal government has given states a break from having to grade students on an A to E scale for first semester.

Western Australia will reinstate compulsory school attendance across all sectors starting from Monday, after several weeks of parents being allowed to keep their children at home.