Employment levels are the mitigating factor for economic recovery, which is why the Australian Retailers Association (ARA) has called for the introduction of the Modern Retail Award to be deferred for at least 12 months.
ARA executive director Richard Evans said in the current economic climate increased wage bills would force over 65 per cent of SME retailers to shed staff.
“Retailers have accepted changes to IR laws including the Fair Work Bill coming into play in July. However, with economic uncertainty and pressure increasing, retailers will not cope with any award increases in January next year,” said Evans.
With unemployment at 5.7 per cent and rising, retailers don’t need the pressure of increased labour costs which will force many to cut jobs.
“We’re now calling on Minister Gillard to defer the introduction of the Modern Retail Award for at least 12 months. Retailers need certainty from the government about any increases to wage bills now, to assist with their cash flow and financial planning while budgets are being finalised,” said Evans.
Working families struggling to run small retail shops will need at least 12 months before they are better placed to manage wage increases without shedding staff, depending on the economic outlook.
“No other economy in the world is introducing new labour laws in the context of the global financial crisis and retailers need certainty and stability before they can cope with wage increases. They simply cannot afford another blow in this tightening economic climate,” said Evans.