Jobkeeper has ended. Now what?
At its peak Jobkeeper payments were being made to 3.6 million employees, but once Jobkeeper 2.0 started this figure dropped to about 1.1 million. This has now gone.
The unemployment rate is now down to 5.8% but it’s worth remembering that this figure does not take into account those people who are under-employed. What we do know, however is that the end of Jobkeeper will see the unemployment rates rise again.
It is predicted that approximately 150,000 jobs will be lost as a result of Jobkeeper ending. To put it into perspective this total represents about 1% of all Australian adults losing work in a month.
The industries that will be hardest hit are related to international travel, international students and hospitality industries, especially in the CBD’s. The arts and recreation sectors as well as the hospitality sector have not really recovered from last years losses and while there has been targeted support from the government these industries are still hurting.
So what does the end of Jobkeeper signify for businesses as a whole?
The Jobkeeper program was always going to come to an end. It remains to be seen whether or not business owners took this into account when receiving Jobkeeper payments.
Those businesses that are still experiencing cash flow issues will need to look at any underlying issues they have. It’s possible that the pandemic has highlighted issues that were already there and has accelerated the rate at which these issues have affected the business.
Futhermore, banks and creditors came to the party by deferring repayments during the COVID-19 crisis period. With repayments resuming those experiencing cash flow issues will be hardest hit.
It is now time for business owners to look at how their business functions. What do they need to streamline? What systems and processes need to be put into place? What changes need to be made?
Flexibility is the key to survival. We don’t know what’s around the corner but we need to be prepared to pivot if necessary. Unfortunately for many businesses this will mean its time to close their doors.
Businesses need to adapt to the new normal and getting the right advice is paramount.
Need help with your business post Jobkeeper? Call me on 0422 391 370.