The jobless rate in Australia has hit the highest level since September 2015, with seasonally adjusted employment falling by 594,300 in April as the economic shock of the coronavirus pandemic cut a swathe through the labour market.

Scott Morrison told reporters in Canberra the job losses recorded to date were devastating, and he warned more would follow. The prime minister said the unemployment rate jumping a full percentage point in a month, from 5.2% to 6.2%, was “terribly shocking, although not totally unexpected”.

The Australian Bureau of Statistics reports that between March and April, full-time employment decreased by 220,500 and part-time employment by 373,800 – which is the period where governments locked down non-essential businesses to slow the spread of Covid-19.

Unemployment increased by 104,500 people to 823,300, and the measure of total hours worked fell by more than 9% between March and April.

The underemployment rate increased by 4.9 points to 13.7% and the underutilisation rate increased by 5.9 points to 19.9%.

The participation rate also decreased by an unprecedented 2.4 points to 63.5% as Australians left the labour market. More women dropped out of employment than men. The youth unemployment rate also jumped to 13.8%.

The ABS says the indicators taken together show that around 2.7 million people, or one in every five person employed in March, either left employment or had their hours reduced between March and April. People on the jobkeeper payment are classified as employed in these measures, even if they are effectively stood down, so the real unemployment rate is significantly higher than 6.2%.

Treasury is forecasting that unemployment will peak at 10%. More than six million people are on the jobkeeper wage subsidy and more than a million are on unemployment benefits, known as jobseeker, which has been effectively doubled during the crisis. The government says mutual obligation requirements have been suspended until 1 June.

Shortly after the ABS unveiled the labour force numbers, the government signalled mutual obligation would be reintroduced in three stages with penalties waived in the first instance. The employment minister, Michaelia Cash, declined to say when the normal mutual obligation arrangements would be reinstated.

Morrison also signalled the enhanced income support had a finite life. He said the wage subsidy and the unemployment benefit were set at levels that in “normal circumstances” would be a disincentive for people to find work.

“That’s why these arrangements with the Covid supplement are temporary arrangements,” the prime minister said. He said it was important that people began to look for work as the economy recovered.

Morrison said he understood people were doing it tough. He said economic conditions now were harder than the experience of the 1991 recession, which was the time he graduated from university and entered the labour market. “I remember it, I remember friends, I remember family who lost jobs, who couldn’t get jobs.

“It was hard. This is harder. We haven’t seen this before. For many young people who have never experienced that, this is beyond anything they could imagine,” Morrison said.

But the prime minister said Australia came out of the 1991 recession and went on to record the longest run in economic growth in recorded economic history “according to some”.

Morrison said there were difficult times ahead as the states moved between now and July to ease Covid-19 restrictions and reopen the economy. He said people should not underestimate the scale of that task.

“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 and that’s why we can’t get too far ahead of ourselves here,” Morrison said.

“The task we have now is to reopen these 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 Labor leader, Anthony Albanese, said the government needed to assist people who were left outside the safety net. “When we look at the jobkeeper program, the government is still leaving people behind, particularly the most vulnerable,” Albanese said.

“Our casual employees, people in whole sectors like the arts and entertainment sector, aren’t getting the support that they need, and the government needs to respond to this.”