Addressing senators in Canberra, he expects between 100,000 to 150,000 people receiving the JobKeeper will lose employment.

Even so, he predicts the unemployment rate will continue to fall across the course of this year and into the following years.

“We expect the unemployment rate to have peaked and will continue that downward trajectory even if there is a bump or two in the next month or so,” Kennedy told a Senate estimates hearing in Canberra on Wednesday.

The jobless rate dropped to 5.8 per cent in February after steadily declining from a 22-year peak of 7.5 per cent during the depths of last year’s recession.

There were around 1.1 million employees still reliant on the JobKeeper subsidy at the end of January, smaller than the 1.3 million Treasury had predicted in the mid-year budget review released in December.

Kennedy said JobKeeper has played a crucial role in supporting the economy and driving the recovery.

“In our view it is appropriate for the program to end as other support measures take effect and to allow the economy to continue adjusting,” he told a Senate estimates hearing on Wednesday.

“We believe that in the order of 100,000 to 150,000 JobKeeper recipients may lose employment at the completion of the program, though there is a wide band of uncertainty around this estimate.”

Shadow treasurer Jim Chalmers said small businesses and workers have been warning the government for months that cutting JobKeeper will cut jobs, but those pleas have fallen on deaf ears.

“If the Morrison government hadn’t wasted hundreds of millions of dollars on companies which didn’t need JobKeeper, there’d be more room to support those small businesses and workers which still do,” Chalmers told AAP.

Since JobKeeper was first introduced in April, more than 2.7 million employees and about 680,000 business have left the scheme, representing a 72 per cent reduction.

Australian Taxation Office data also shows that all industries have seen a significant decrease in the number of employees covered by JobKeeper, including a 83 per cent fall in retail and a 69 per cent drop in accommodation and food services.

Treasurer Josh Frydenberg said the final JobKeeper numbers for January confirm that Australia’s economic recovery is broad based across all states, regions and industries.

“We know that some families and businesses are still doing it tough and our message is that the Morrison government continues to have your back,” Frydenberg said.

He said the government’s economic recovery plan will continue to provide support through targeted measures as well as tax cuts, business incentives and a record investment in skills and training and infrastructure.