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With the sector contracting, SME organisation calls for government to take immediate action on labour shortages.
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Small business ‘screaming for workers’, says COSBOA chief
20 September 2022
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11 minute read
Small businesses are “screaming for workers” and the shortfall is forcing a contraction in the sector that needs immediate action by government, the head of COSBOA says.
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The small business organisation finds 172,000 workers are needed in the food supply chain alone, including 100,000 in hospitality, 15,000 in convenience stores and 12,000 in meat processing.
The Council of Small Business Organisations Australia (COSBOA) said that the dramatic increase in job vacancies left countless small businesses unable to operate at their full potential, with many limiting the hours they are open and reducing services and products.
“Small businesses are screaming out for workers and it's a contraction in the small business economy,” said Ms Boyd.
“We’ve been talking about this for six months, we cannot wait for a white paper to come out before action is taken, we need to see action happening sooner because there are huge worker shortages across all industries.”
CEO at MGA Independent Retailers Jos de Bruin said that increased costs alongside worker shortages were making it almost untenable for several businesses.
“Independent food and grocery supermarkets, liquor stores, and timber and hardware businesses have never before experienced worker shortages as we have seen in the past 12 months,” said Mr de Bruin.
“The situation is diabolical as members struggle with increased wages costs and costs of doing business coupled with insufficient staff to help run their stores.”
Ms Boyd said that due to the shortage small businesses were having to shorten their opening hours or not trade at all some days, which harms not only them but the entire economy.
“You’re taking days off or days away from working then that means that you’re not operating at full capacity, you’re not employing people as much as you’d like to, but importantly you’re not earning the income that you need to keep your business going at maximum output,” she said.
The findings by COSBOA, in its inaugural quarterly data report, were released on the weekend after being made available to the recent Jobs and Skills Summit, where Ms Boyd made a high-profile pitch for the small business sector.
The report also examined the influence worker shortages were having on regional towns with many townships predominantly made up of small businesses.
Data received from the Australian Government National Skills Commission 2022 and Regional Australia Institute 2022 showed that 84,000 regional jobs were advertised in June 2022, 28 per cent of the national total of 303,400.
The report said that regional areas experienced a higher rate of growth in job advertisements from pre-pandemic levels compared to capital cities, a 95.8 per cent increase compared to a 60.6 per cent rise.
Ms Boyd said that regional businesses needed to be held at the centre of any decision made to improve the worker shortage dilemma as they are at the heart of their communities and are suffering greatly.
“The reason why we highlighted regional areas is because we would like to see more of the considerations, when it comes to policy areas, around place based approaches so we can service the needs of regional areas in terms of migration, in terms of population, in terms of skills,” she said.
“How do you meet the needs of those businesses in that area and have a place based approach where you actually recognise where the strengths and weaknesses are of the small business cohort within an area and say these are the skills we need for the future.”
COSBOA’s report also gathered data from NAB’s quarterly SME survey which revealed that 80 per cent of firms reported availability of labour is a key constraint for businesses.
The report said that productivity growth was key to creating sustainable economic development but the workforce shortages were preventing small businesses from fully participating in it.
It said that instead of working on developing their businesses, small business owners are needing to work in them, serving customers and unloading stock, instead of focusing on future growth and seeking business opportunities.
“What we need is a serious consideration for the worker shortages that all industries are facing,” said Ms Boyd.
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