The Fair Work Australia’s decision to increase the minimum wage by 2.9 per cent has left many retailers heart broken as it ignores strong signals that the sector is struggling.
The 2.9 per cent increase equates to a weekly increase of $18.78 for the Retail Employee Level 1 pay level.
Australian National Retailers Association (ANRA) CEO Margy Osmond said the minimum wage decision is extremely disappointing and is a blow for retailers already struggling to survive.
"The decision speaks about the benefits gained from the strength of the mining boom and acknowledges the weakness in the retail & hospitality sector. However, the panel has ignored a wealth of economists and commentators, and the strong signals from the Reserve Bank of Australia and in the Federal Budget that the sector is clearly struggling. It has remained unpersuaded that there are currently ‘exceptional circumstances’ in retail that might indicate a need to ‘press the pause button’ on an increase in retail sector wages,” she said.
"This is short-sighted and will add yet another burden to struggling retailers - particularly smaller operators and may put a brake on the few groups within the sector that are showing some growth," Mrs Osmond said.
Similarly, Australian Retailers Association (ARA) executive director Russell Zimmerman said the decision handed down would add to the series of hits the retail sector is currently taking as a result of low consumer confidence brought on by a soaring cost of living, taxes and charges as well as various regulatory burdens on business.
“FWA has hand- picked and isolated the food, cafe and restaurant categories to come to the erroneous conclusion that the retail sector is growing. The reality is the sector as a whole has not posted any significant growth for almost two years, with overall year on year figures consistently below inflation levels,” he said.
“FWA has clutched at straws in order to deny the retail sector the chance to focus on growth and maintain employment, and has not listened to evidence from retailers at the coal face of operations who have clearly stated they will not be increasing their staffing levels and are planning to or have already shed staff.”
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