Tuesday 11 May 2021
The Australian Retailers Association (ARA) has welcomed the focus on addressing skills shortages and tax cuts for business and low and middle income earners in tonight’s 2021-22 Federal Budget but called for further support for businesses that remain distressed by the uneven recovery.
Business support and measures to address the skills shortage
“Australia’s economy is in an enviable position – unemployment is down and business confidence is at record highs – but we can’t become complacent. We need to consolidate our head start in the global recovery,” ARA CEO Paul Zahra said.
“The investment in skills is welcome, including a $1 billion extension to the JobTrainer program. But for these measures to translate into job outcomes, we need more flexibility for retailers to access the scheme. As Australia’s largest private sector employer – with one in 10 Australians working in the industry – retail plays an important role in the employment and skills rebound.
“The tax cuts for low and middle income earners will help ensure there’s more money in people’s pockets to support retail spending and create more jobs.
“We welcome the further extension of measures for business to write off the full value of any eligible asset they purchase. This will allow businesses to make the investments they need in equipment so they can continue to grow and thrive in the post Covid world.
Uneven retail recovery – many businesses remain distressed
“The retail sector as a whole is tracking well, but there are two cohorts we remain deeply concerned about. Travel retailers, like duty free shops and stores located in airports, have been severely impacted by international border closures, along with retailers in CBD locations, especially small businesses in both Melbourne and Sydney, where foot traffic is still catastrophically low,” Mr Zahra said.
“These are businesses that continue to suffer through no fault of their own, and unlike other industries like tourism and aviation – they haven’t been thrown a government lifeline beyond JobKeeper. It’s these businesses that are at risk of being left behind in Australia’s economic recovery.
Women a key focus
“Women are the backbone of the retail workforce – they represent 68% of sales assistants and 75% of checkout operators. There is a clear focus on women as part of this year’s Budget – and that’s long overdue – with additional funding for women’s health and domestic violence programs,” Mr Zahra said.
“The $1.7 billion child care package is also significant. This will provide more choice for working mothers and also puts more cash into the family budget each week, which are good outcomes for Australian families, the retail sector and the broader economy.”
Superannuation
“The Federal Government will remove the current $450 per month minimum income threshold, under which employees do not have to be paid the superannuation guarantee by their employer,” Mr Zahra said.
“This measure aims to improve equity in the superannuation system by expanding the superannuation guarantee coverage for cohorts with lower incomes. This will provide a much needed boost for people’s super accounts – in particular women, who traditionally have less retirement savings than men.
“The Retirement Income Review estimated that around 300,000 individuals would receive additional superannuation guarantee payments each month, 63 per cent of whom are women.”
Digital economy
“The pandemic has created a powerful shift in the way people live and work and how people purchase the goods and services they need,” Mr Zahra said.
“When lockdowns and restrictions were introduced just over a year ago, some retail businesses had to scramble to boost their online and digital offerings, so they could continue to operate while people were confined to their homes.
“The migration to online is a permanent one, with more and more consumers purchasing the things they need with a few taps of their fingers and embracing new methods of contactless shopping. It’s part of an acceleration of trends we’ve seen over the past 12 months, and that will continue to evolve in the years and decades to come.
“It’s important that businesses, particularly small business, have the skills and knowledge they need to keep up with the rapid rate of innovation and new and emerging consumer trends.
“The Federal Government’s investment as part of a Digital Economy Strategy is an important step towards boosting our productivity and securing our country’s future prosperity. The investment will also support jobs growth as future skills in retail become more technology and science based.
“Consumers are now expecting retailers to ‘meet them where they are’, through consistent, seamless omni-channel interactions – and that involves businesses having a clear and dedicated focus on digital.
“We welcome the Federal Government’s commitment to enhancing the digital capabilities of Australia’s businesses.”
