Staff shortage due to the international travel ban and its effect

troubling times

According to a report in IBIS World, the continued uncertainty around the pandemic is what’s restricting consumer spending and causing business confidence to dip. Though vaccines are now widely available, the rapid spread of the Omicron variant is obstructing the economic recovery. Accordingly, business confidence, consumer confidence (weakest it’s been in 30 years), consumer sentiment, business profit, and trading conditions are forcasted to deteriorate. Construction, supermarkets, transport, healthcare, food services, accommodation, personal care, retail, and gyms are the most heavily affected industries .

small businesses are haemorrhaging

Consumer spending has dropped sharply as a result of numerous businesses operating at reduced capacity and shorter hours to help suppress the virus. In a recent ABC News Report, Professor Warwick McKibbin from ANU’s Crawford School of Public Policy said that small businesses which provide the most jobs in Australia’s economy are suffering from worker shortages and slower spending. The greatest economic loss, he adds, wasn’t from shutdowns but how people’s behaviours have changed in the pandemic. Terrified of catching COVID-19, people have avoided going out thus cutting back on shopping. Hence, this domino effect of events has left many Australian small businesses struggling to keep their head above water.

labour shortage – code red

Moreover, the Australian Retailers Association reported that an estimated 76% of retailers had staff in quarantine due to COVID-19 in mid-Jan 2022 alone! Situations are so dire that without immediate government intervention, some small businesses could be completely wiped out. As hairdressers were not deemed an essential industry by the national cabinet, staff who were close contacts of positive COVID-19 cases weren’t granted a shorter isolation period. “Until close contact isolation requirements are relaxed for all workers, businesses will continually be forced to close or significantly reduce their operating capacity.

It is likely that national cabinet will need to revisit close contact isolation protocols as long as acute staff absenteeism continues,” shares Australian Chamber of Commerce and Industry boss Andrew McKellar. “No matter how many workers are exempt from isolation requirements, the biggest issue at the moment is the supply of rapid antigen testing. Severe shortages of tests mean that many employees in these critical sectors will still be unable to fulfil requirements to return to work.”

light at the end of the (Omicron) tunnel

The government has a scheme in place to help small and medium-sized businesses with revenues affected by the pandemic. However, there really isn’t a broad strategy available for businesses experiencing a drop in cashflow.

Aside from financial aid, there is a silver lining on the horizon thanks to the border reopening to international students in December 2021. With it, the government is relaxing its visa rules by giving eligible Australian student visa holders the opportunity to work up to 80-hours a fortnight. Basically, the move is a short term answer for labour issues by filling staff shortages across sectors affected by the pandemic. Thereupon, this temporary relaxation to the visa rules will help businesses stay open and to assist supermarkets to meet the demand for critical goods. Even aged care facilities will be able to benefit from this to help relieve staff shortage pressure.

Additionally, several major retailers have also started increasingly investing in supply chain management initiatives to help curb hurdles brought about by Omicron. The government’s current aims are minimising the spread of the virus, lessening the chance of catching COVID-19, and quicker testing methods. Therefore, the national cabinet has also decided to subsidise rapid antigen tests for concession card holders, people with symptoms, and close contacts. It’s not perfect, but it’s good to know that small steps are being taken to help Australian businesses get back to some form of normality.

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