The Devonport, Burnie and Central Coast Chambers of Commerce Small Business and Wages survey has revealed over 80% of small businesses along the North West Coast are optimistic about the future.
Responses came from far and wide up the Coast from Devonport to Smithton and included a range of sectors such as construction, hair and beauty, cleaning, financial, transport, manufacturing, pet grooming, fitness, lighting and electrical, printing and advertising, real estate, medical and primary producers. Roughly 30% were tourism based and another 30% retail based.
32% of respondents had no staff on Minimum Award rates and 14% had all their staff on the Minimum Award. The remaining business had a mix of staff on or above the minimum award.
Over 60% of businesses said an increase in the Minimum Wage to a Living Wage would affect their decision to hire more staff, or preference casual or part time appointments over full time positions.
Only 40% of businesses said if the cost of wages was to rise beyond a sustainable level for their business, they would look at digitalisation ie: using time saving technology instead of an employee.
Respondents were asked to nominate a wage increase their business could sustain – these ranged from zero to 3 or 5% with the most citing 3% or CPI. One respondent noted “Retail sector is incredibly tough. Any wage increases will leave me no choice but to reduce weekly allocated hours per site”. Another respondent said “Any increase is felt. We cannot sustain an annual increase. If wages go up too much, there will be an extra 5 people looking for other employment.”
Over 55% of businesses surveyed had a turnover of under $1 million. 22% had under $2 million and 16% under $5 million.
40% of businesses said their business plan for the next financial year assumed expansion with just over 50% assuming the same turnover. Just under 10% anticipated downsizing.
The survey also looked at changes to Sunday Penalty rates and asked if business had hired more staff or changed their opening hours, as indicated in the DCCI survey in 2015. Most respondents said they were not open on Sunday, or it made little impact, however of those that were affected said their ability to bring in staff on the weekend had improved and they break even on Sundays under the new award rates instead of running at a loss.
The Chamber Presidents said it was disappointing 60% of business would not look at bringing in technology if wages growth affected the viability of their business. “What we don’t want is business carrying the burden of higher wages and having no option but to close their doors. Small business must be given pathways to outsource parts of the business or introduce technology if wages increase beyond what is currently sustainable.
“We are calling on the state and federal governments to increase funding to assist small business keep pace with technology”.
“We must maintain the current level of confidence and momentum that has emerged in the last few years or go back to the sluggish business conditions and lack of investment we’ve seen on the NW Coast in the past.
The Chamber Presidents noted it was clear from the survey results that while small business on the coast expected to do the same turnover or better next financial year they were vulnerable to wage hikes over CPI and appeared to have no strategies in place to deal with this other than further casualisation of the workforce or redundancies.
It was also noted that measures to assist small business to drive productivity have had little air time in election debates.
For further information contact:
DCCI President – Dane Layton
0407 243 208
BCCI President – Ian Jones
0412 061 501
CCCCI President – Nathan Kelly
0488 661 355