The Australian Small Business and Family Enterprise Ombudsman, Bruce Billson, is encouraging Australians to celebrate World Micro, Small and Medium-sized Enterprises Day on 27 June by saying thank you to small and family businesses for their contribution to our economy and our country.
“These are great people in plain sight, and we see them everywhere, every day,” Mr Billson said.
“We depend heavily on the small and family-run businesses in our lives who work every day to delight customers and energise enterprise.
“The best way to support small businesses is to be a kindly customer – patient and understanding, with good and generous intent.
“Small business also needs to be front of mind for our policy makers and regulators. We need to do all we can to shift the mindset from minimising headwinds to maximising the ‘wind in the sails’ of our hard-working small and family businesses.”
Mr Billson called for a greater appreciation of the contribution of small business to be shown by creating the Prime Minister’s Small Business Awards and for state, territory and federal governments to require every Cabinet submission to include a small business impact statement.
“Why not establish the Prime Minister’s Small Business Awards to celebrate excellence and inspire the next generation?” Mr Billson said.
“And a simple improvement that governments at all levels around the country could take is to require every submission to Cabinet to include a small business impact statement.
“Every well-intentioned change by Parliament or regulators risks adding to the mountain of red tape that gets between the owner and the small business they are trying to run.
“Regulatory impact assessments should start with and focus on small business implications, not consider this as an afterthought. This would mean every time a decision is made, small business will be front of mind and bright on the radar screen.”
Almost 98 per cent of businesses in Australia are small businesses – some 2.5 million who generate almost $600 billion of economic activity accounting for 33 per cent of our nation’s GDP.
Small businesses provide jobs for 5.36 million people – 42 per cent of private sector jobs.
“This contribution is truly worth of recognition and celebration, but in 2006 the sector contributed 40 per cent of GDP and employed 53 per cent of private sector jobs,” Mr Billson said.
“This worrying trajectory shows we need to do more to energise enterprise.
Just released figures from the Tax Office show 46 per cent of small businesses didn’t make a profit in the most recent year of accounts available.
And some three-quarters of self-employed business owners are earning less than the average total weekly, full-time earnings.
“There’s no rivers of gold for these people, just a hard slog,” Mr Billson said.
“Surely, we can do more to get the risk and reward balance right, ensuring small business and entrepreneurship is a really attractive option for people, then create a supportive ecosystem to give enterprising people the best chance to be successful.”
Mr Billson said there needed to be a greater understanding of the cumulative demands and resource-constrained circumstances of small businesses.
“There’s a flurry of new workplace rules and obligations, changes to privacy laws, fear about cyber security and what we call ‘white tape’ where big business is asking for more and more information from small businesses suppliers,” he said.
“Small and family businesses are not looking for an escape hatch, but need a right-sized, actionable, fit-for-purpose, and efficient approach with appropriate support and guidance.”
Data compiled by ASBFEO also shows small business owners are also getting older with the average age now 50, up from 29 where it was in 1976. In the 1980s there were twice as many small business owners aged between 30 and 49 as there were aged over 50.
Only 8 per cent of our small business owners are under the age of 30, half what it was in the 1970s.
“Why is the next generation not seeing self-employment and their own enterprise as a pathway for the future?” Mr Billson said.
“At a time when young people, particularly, look for purpose as well as profit in their lives, isn’t self-employment a natural fit?
“Encouragingly, 35 per cent of small businesses are owned by women –double the rate from the 1970s. Increasingly, new businesses are being created by women who are finding solutions to everyday problems, sharing their ideas and building a business from their ingenuity.
“One in three small businesses are also run by people who were born overseas and our culture, local business communities, and the choice of goods and services available to consumers and other businesses, are enriched by their presence.”
Mr Billson said small business is a dynamic and fast-growing sector that allows people with an entrepreneurial spirit to pursue their dreams and own livelihoods.
“They come with varied ambitions, backgrounds and experiences but what they have in common is the desire to have a go,” he said.
“Taking on the responsibility of owning and running a small business can be inspired by a range of goals and motivations, an abundance of purpose and meaning and be rich with unpredictability of challenges, flexibility, self-agency and income.
“The spirit that drives people to run a small business also makes them great advocates for and contributors to their community and they are more likely than the general population to be a volunteer.
“For small and family business owners, their identities are interwoven into their business and the stakes are so much higher than just a job. Many people have invested a lifetime — and put their family home on the line — to build up their business, which amplifies the emotional challenges.”
Mr Billson said it was important those running a small business look after their emotional well-being and mental health and commended the Australian Government’s budget decision to provide $7.7 million over two years to extend funding for mental health support through the New Access for Small Business Owners program and $3.1 million over two years for the Small Business Debt Hotline.
“We have seen a 20 per cent increase in calls to our helplines over the past year from small businesses struggling to manage their debts,” he said.
“Sometimes it can be as simple as making time to pause, reflect and reconnect. Talking to trusted advisers and networks is a great way to find solutions. Our website www.asbfeo.gov.au also has tools and resources that can be useful.
MSME Day is an initiative of the United Nations General Assembly to raise public awareness of small business’ contribution to our prosperity, wellbeing, and community.
