WA businesses fear the end of JobKeeper

The West Australian,
Renee Bennett, who is the Managing Director of Encanta, an event management company established over 25 years agoIan Munro 21/07/2020
Renee Bennett, who is the Managing Director of Encanta, an event management company established over 25 years agoIan Munro 21/07/2020

WA businesses say some industries are “falling through the cracks” and fear the end of JobKeeper in a little more than six weeks will cause financial pain.

Renee Bennett, owner and managing director of Inglewood-based Encanta Event Management,who accessed the wage subsidy last April when COVID ravaged her industry, still has nine employees on JobKeeper.

“While there are reports that business events are recovering, the lockdown last week has caused another level of uncertainty, with businesses and clients now looking at postponing until 2022,” she said.

Ms Bennett, pictured, said JobKeeper ending on March 28 would affect her business.

“The new Federal Tourism Minister (Dan Tehan) has indicated there will be some relief for tourism when JobKeeper ends, but whether our sector falls into tourism will always be the issue in terms of being able to get that support,” she said.

“We fall through the cracks … business events, which is predominantly my level of business, should technically come under tourism.”

Mr Tehan this week flagged the Federal Government had started considering support options for the struggling tourism industry, after acknowledging that international travel would be unlikely to resume until the end of 2021 at the earliest.

While some industries in WA were still struggling, it appears many were prepared for the end of the wage subsidy.

Danny Olsen, BDO Perth partner, said the number of businesses eligible for JobKeeper had declined over the past few months, which meant fewer were experiencing reductions in revenue.

“The decline in JobKeeper eligibility among WA employers is a strong indicator that businesses are on their way to recovery,” he said.

“But there is still a significant amount of caution in the business community despite the signs of recovery and growing revenue.”

Mr Olsen said he expected business confidence would improve as the timetable for the vaccination rollout neared, and “with greater stability generated as borders remain open”.

Confidence and conditions among WA businesses continue to outperform the nation, according to NAB’s quarterly SME business survey, released yesterday.

The report showed business conditions in WA, which is an average of employment, trading and profitability, sitting at just over 20 points in the fourth quarter last year, compared to the national average of just over 10 points.

By State, Victoria led the gains in business conditions (up 20 points) and confidence (up 41 points) as it emerged out of lockdown. Victoria now has the highest level of confidence of any State, but the lowest level of business conditions.

Nationally by industry, leading the gains in confidence was accommodation, cafes and restaurants (up 48 points) and health (up 38 points). The biggest gains in conditions were in retail and personal services, which both rose 18 points.

Outside construction (-1 index point) and personal services (-12 index points) all industries recorded positive conditions, suggesting most sectors across Australia had returned to growth.