An underwhelming budget for local business, as economic headwinds continue to strengthen
The Canberra Business Chamber says that more investment is needed to support and protect the local businesses that will drive economic diversity, job creation and sustainable economic growth, as they struggle with skills shortages, rampant cost increases, and shortages of supplies and workers.
“There are 31,500 private businesses in the ACT,” said Chamber CEO Graham Catt. “The vast majority – around 97% – are small enterprises employing fewer than 20 people and are the passion and the life’s work of their owners. It is these businesses, not the public sector, that now provide over 63% of the territory’s jobs.”
“The Chief Minister has highlighted the strength of the ACT labour market,” said Mr Catt “but skills and workforce shortages are very real indeed and a huge problem in the ACT. The number of vacancies is almost double the number of people seeking work, and this is a real handbrake on economic growth. Businesses can’t find staff. They are running out of options, and some local companies have no choice but to move interstate.”
“We need more than a marketing plan. Investing in workforce attraction now is critical, along with a clear plan for future workforce based on the number and nature of Canberra businesses. That means working with local industries to set clear targets, developing education and training in the ACT, as well as strategies to attract skilled people in specialist areas.”
Although the budget includes $22.4 million to deliver initiatives to develop “knowledge intensive sectors”, there is little detail currently of how this will be delivered or what is involved.
“Our members are concerned the ACT Government’s believes that local businesses no longer need support. Small businesses are increasingly in unchartered territory, with unemployment at record lows, the staff they need costs simply unattainable, and costs and inflation hitting record highs.”
“Local businesses aren’t looking for handouts, or miracle fixes to complex global problems like labour shortages,” said Mr Catt. “But they do expect private sector investment that demonstrates an appreciation of their significance to economic recovery, and of the scale and impact of the challenges they currently face.”
Support for the ACT tourism industry, one of the sectors most impacted by the COVID pandemic, is badly needed and welcomed by the Chamber. But other businesses in a range of sectors also need support to adapt and manage the challenging economic conditions ahead. In addition, businesses will need support to transition their operations in line with ambitious policy initiatives such as a transition to a net zero economy.
“And as local businesses struggle with labour shortages,” said Mr Catt “every hour they spend on unnecessary regulatory processes is an hour lost to customers, employees, innovation and growth. We need to fast track reforms that take the pain out of business interactions with government and make it easier to start and grow a business in Canberra.”
The budget foreshadows expenditure of $7 billion over 5 years on a pipeline of infrastructure projects including Canberra Hopital Expansion, CIT Woden Campus and Bus Interchange, “light rail stage 2 and a range of smaller initiatives.
While the Chamber welcomes these projects, it wants to see supporting policies to ensure that money will be spent with local companies to deliver them.
“We will be missing out on the benefits if the government funds out-of-town businesses to do this work. Let’s support the investment with policies mandating local procurement,” Mr Catt said.
The Chamber says that there is an urgent need for longer term thinking about how to manage key areas like skills, education, regulation, taxation and planning to support economic growth and job creation.
“The world is changing rapidly, and the national capital is competing globally and domestically for the business investment and skills we need. Clear plans, developed through genuine engagement with industry, will be critical to our future,” Mr Catt said.
Media Contact: Graham Catt, CEO, 02 6247 4199