The Australian business landscape has experienced a significant shockwave, with a staggering 362,893 businesses closing their doors this morning, according to the latest ABS announcement. Representing a staggering 14% exit rate, this mass closure is having a profound impact on the economy and the small business sector. To gain insights into the broader implications of this economic downturn, we spoke with Ben Thompson, CEO and Chief Economist at Employment Hero. In the following article, Thompson offers his expert analysis and advice on navigating this challenging period.
“The ABS’ announcement this morning on business count, entries and exits reveals a troubling surge of 362,893 closures; 14% exit rate. This is very concerning, particularly among SMEs. But these figures, unfortunately, were something we were expecting,” says Ben Thompson, CEO and Chief Economist, Employment Hero.
“We have observed the consistent struggles of Australian SMEs for quite some time now, and this directly underscores the severe economic pressures facing the sector. However, these numbers should serve as the final wake-up call: Australia’s SMEs are not just struggling – they’re shutting down at an alarming rate.
“The current economic climate, marked by soaring inflation, rising costs, and weakened consumer confidence, is pushing many SMEs to the brink. In fact, ACCI recently revealed half of Australian SMEs have considered closing their doors in the last 12 months. Likewise, new and ever-changing regulations on businesses are adding even more of a burden, putting businesses at risk of non-compliance that can pin them with major fines.”
“Without urgent, targeted support, we risk losing a significant portion of the backbone of our economy, along with the jobs and communities that depend on them. It’s imperative that we act now to safeguard the future of our SME sector.”
