Small businesses put migration, skills, and IR reform on summit agenda

Labor MP Jim Chalmers. Source: AAP/Joel Carrett.

Boosted migration levels, reduced red tape, an improved skills mix, and stronger outcomes for marginalised workers are all on the wishlist for Australian small businesses ahead of September’s landmark employment summit.

On September 1-2, the Albanese government will make good on its election pledge to meet with business groups, union representatives, and social service advocates to tackle some of the biggest challenges facing the Australian economy.

“There’s a genuine appetite in the community to try and address these big economic challenges and that’s what the summit will be all about,” Treasurer Jim Chalmers told ABC’s RN Breakfast Tuesday.

Convening a meeting of employers and employees will help the nation emerge from a decade of “stagnant wages” and a pandemic-induced period where the “migration tap was largely turned off”, he said.

The final attendance list and the Canberra summit’s precise runsheet are yet to be finalised, but business groups have already publicly expressed their hopes for the landmark meeting.

Migration

The Council of Small Business Organisations Australia (COSBOA) CEO Alexi Boyd says the primary concern for small businesses in 2022 is attracting and retaining the right staff.

The nation recorded 480,100 job vacancies in May this year, the latest Australian Bureau of Statistics data shows, giving credence to job listing data and employers who say there simply aren’t enough workers to fill open positions.

Expanding Australia’s skilled migration system would help, Boyd told The Today Show Tuesday morning, even though sponsoring overseas workers may come at a higher cost to the business than seeking a local worker.

“It can be expensive for a small business owner to bring someone in but at the same time, we are hearing that a lot of them are happy to pay that amount if they know they have got someone for up to a year,” she said. “It is worthwhile at the moment.”

Expanding the list of skilled migration list to boost the influx of workers would help, Boyd added.

Retailers agree. On Monday, Paul Zahra, CEO of the Australian Retailers Association, said the nation needs to cut “red tape around immigration” to make up for several years of ultra-low migration.

“Unfortunately, Australia’s brand has been damaged due to the COVID-19 lockdowns from the past two years, and we’re struggling to complete globally for foreign workers, who no longer see us as an attractive option to live and work,” he said.

Mark McKenzie, CEO of the Australasian Convenience and Petroleum Marketers Association and former COSBOA chair, says reform must provide “meaningful paths to permanent residency, which is what effectively most visa workers are looking for”.

“Australia lags behind the other economies who have made major changes in a post-COVID world,” he added. “And we’re still arguing about numbers. It’s not just about numbers. It’s about the structure of immigration system.”

The big end of town feels the same way. On Monday, Jennifer Westacott, chief executive of the Business Council of Australia, said: “We need a migration system that fills workforce shortages across the economy with the right targeting and incentives.”

In a statement, the Australian Council of Trade Unions said the summit should ultimately “ensure that migration is providing opportunities rather than exploitation”.

While acknowledging the push for heightened migration, Chalmers on Tuesday said he “would caution people against thinking that migration is the solution to all of our economic challenges.

“It’s part of the story, but it’s not the whole story.”

Skills

Business groups agree that migration is not the be-all and end-all solution to Australia’s skills shortage, saying private enterprise should help guide attempts to boost the local skills mix.

One of Labor’s landmark election policies was a long-reaching $1.2 billion plan to offer free TAFE courses and expand university places.

Small businesses should be at the forefront of the government’s skills strategy, Boyd told SmartCompany Tuesday morning.

“It actually needs to be an industry-led approach, because every industry behaves differently in terms of skills,” Boyd said.

The ACTU hopes to work with the private sector to boost the level of talent available domestically, secretary Sally McManus said.

“We must rebuild our manufacturing industry and work together to build the skills we need for the jobs of the future.”

Workforce participation

While business groups call for more workers from overseas, focus has also turned to how hard-hit industries can most effectively utilise local workers.

Part of that involves changing who is allowed to work and eliminating barriers to employment, business groups say.

The ARA wants the summit to discuss the aged pension income test, which may disincentivise older workers from picking up shifts at their local store and helping to alleviate staffing shortages.

Of particular note are the barriers keeping many caregivers, especially women, from participating in the workforce to the same extent as their male counterparts.

Labor has pledged $5.4 billion to increase government subsidies for childcare, a plan it hopes will make it easier for parents to return to their jobs.

On Monday, Chalmers said increased migration should not be seen as a “substitute” for childcare reforms.

But as the program only kicks in from July 2023, Zahra called for an “increased focus” on childcare provisions.

“Women are another key focus area — they are the backbone of the retail industry, making up more than half of our workforce, however they’re significantly impacted by the limited options for childcare support,” he said.

Such concerns have troubled COSBOA for some time.

“We’re hearing that small businesses are finding people to take shifts only for them to turn around and say ‘I can’t take this job because I can’t afford to put my kid in childcare while I’m at work’, or ‘I can’t find anywhere to live near this job’,” Boyd said in June.

Other barriers exist, too.

In a Tuesday statement, Australian Constructors Association CEO Jon Davies said a lack of diversity in the sector and poor mental health outcomes were acting as handbrakes on the hard-hit sector.

Enterprise bargaining and broader structural reform

Speaking on Tuesday, Chalmers said the summit will address the enterprise bargaining system, which “hasn’t delivered the kind of sustainable, consistent wages growth that we want to see in the economy”.

Small business groups have long argued that complexity in workplace agreements is hampering growth, and the summit presents an opportunity for those organisations to plead their case.

“One of the most difficult things that small businesses have to spend a lot of time on is compliance and understanding of the modern award systems,” Boyd said.

“What can we do to make that process easier? Because if it’s easier and simpler, that will improve compliance. That needs to be examined.”

McKenzie says it was essential for the government to make Australia’s industrial relations system “work better for small businesses in particular, who suffer from low levels of access to the system because it is so complex and difficult to navigate”.

COSBOA this year floated the idea of a ‘small business schedule’ for all modern awards designed to slash complexity for small businesses, and Boyd did not rule out presenting existing ideas at the summit.

“I don’t mean to be vague, but I think we need to have everything on the table, things that have been examined in the past,” she said.

“And what do we need to move forward? So if everything from the past needs to be considered there’s certainly nothing that should be discounted, but that simplicity is key.”

At the same time, Boyd says small businesses which flout the rules of the modern award system must be “stamped out”.