Costs are killing retail jobs – ARA to inform national red tape conference

PEAK retail industry body the Australian Retailers Association (ARA) urges the Federal Government to give retailers the opportunity to grow the Australian economy and create employment opportunities by quickly removing unnecessary red tape costs.

ARA Executive Director Russell Zimmerman will present at the Regulatory Reform conference in Canberra tomorrow morning. Mr Zimmerman will outline key cost blowouts which are killing jobs and growth in the Australian retail sector, as well as highlight potential employment growth opportunities if these issues are addressed in a timely manner. 

“The key message we will be delivering is that retail has a real opportunity for jobs and economic growth over the next five years, however, regulatory costs have stifled that growth in the last five years. The only way we will achieve our potential is to remove costs and restrictions. 

Key points that will be raised include: 

  • Over the last five years retail has grown by around 2% p.a. while jobs have only grown by 0.2% p.a.
  • Average full time wage is now over $55,000 with regulation killing flexibility.
  • Ernst & Young report confirms 93,000 jobs have been lost due to non-collection of overseas GST and the sector could grow by 87,000 jobs in the next four years with this red tape non-compliance measure being removed.
  • ARA/ACCI report shows 70% of businesses had their red tape burden increased in the last 12 months.
  • More than 55% of all businesses indicated they had no capacity to pass the cost of regulation on to consumers.
  • The carbon tax has significantly increased costs for retailers (e.g. for bakery retailers by $20,000 p.a.)
  • Almost one quarter of businesses (23%) spent between $10,001 to $50,000 on compliance management.
  • Safety and Workers Compensation is the most complex area of compliance (55.8 %). This was followed by Employee Wages, Conditions and Superannuation (51.4%) and Tax Compliance Obligations (47.5%).

“The retail sector shows real promise as the jobs driver for the economy over the next five years, but in order to achieve this, we must reduce costs and burden on retailers. 

“I see retailers every day of the week, from single store businesses to the boardrooms of some of Australia’s largest companies, and I can confirm that all of them have done a fantastic job in surviving - they have all had to cut costs and cut jobs. They are running on the smell of an oily rag. 

“The ARA congratulates the government on their first steps to reducing burden but the bulk of the work is still in front of them,” Mr Zimmerman said. 

Since 1903, the Australian Retailers Association (ARA) has been the peak industry body representing Australia’s $265 billion retail sector, which employs over 1.2 million people. The ARA ensures retail success by informing, protecting, advocating, educating and saving money for its 5,000 independent and national retail members throughout Australia.

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