Employers at breaking point – More financial support needed for SMEs in lockdown

Published July 26, 2021 -
Struggling Business

While the financial support offered to business owners in New South Wales in lockdown has helped many keep their doors open for the short-term, without more substantial payments, hundreds, if not thousands of businesses will have no choice but to close their doors before the year ends.

While the current business support packages and disaster payments have bought employers more time, it is inadequate compared to the ever-growing cost of maintaining a business in a lockdown now entering its fifth week.

Employsure, workplace relations advisor to more than 30,000 small and medium-sized businesses across Australia and New Zealand, has seen an increase in calls from worried business owners over the past several months.

“Since January, there has been a 30 per cent increase in calls to our advice line for employers regarding termination, and a 68 per cent increase in grievance-related calls,” said Employsure employment relations specialist Josh Paterson.

“To put this in perspective, 4000 of these termination-related calls were received in June alone, the highest monthly figure since the first national lockdown in April last year. We expect these numbers to have greatly increased once our final July figures are tallied.

“These disaster payments in their current form are a mere sprinkle of support aimed at slightly prolonging the life of small businesses. What we need to see is an all-in JobKeeper-style scheme that will help provide struggling SMEs with enough support to pay for staff, stock, maintenance and utilities.”

The federal government has said further financial support may be on the cards for small business owners, but has ruled out bringing back the JobKeeper wage subsidy scheme that greatly helped prop up the Australian economy during the first year of the pandemic.

Under what is currently being offered, employers are still being forced to make difficult decisions as to what costs can be fairly cut from their business, and what changes have to be made to protect their cash flow. Many have also had to stand down staff or make them redundant.

With reports the lockdown in Greater Sydney could run through to mid-September the situation will get worse before it gets better.

“Employers have every right to be worried. This lockdown and the financial stress associated with it is getting to people, and we saw how that worry can turn to anger in the protests over the weekend,” continued Mr Paterson.

“The cost of maintaining a business and paying staff can add up significantly with each passing day, and the support currently being offered is not nearly enough to supplement this. Small business is the lifeblood of the economy, and the government needs to be flexible with providing additional support where it’s needed over the coming weeks and months.”

Further enquiries:

Matthew Bridges

[email protected]

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