A recent survey of Australian employers has found almost 70 percent of businesses expect the new Minimum Wage rates will have a negative impact.
The survey conducted by Employsure found most employers could not afford the hourly increase and would look at ways to cover their bottom line. The new wage rates, which encompass an increase of 3.5 percent, will go into effect from July 1. 2018. The new minimum wage will increase hourly rates to $18.93. The decision will have a significant impact on businesses, industries and more than 2.3 million employees who are paid the National Minimum Wage or minimum Modern Award rates.
The increase in Minimum Wage alone means that each impacted business will need to pay an extra $24.30 per week, per employee, from 1 July 2018.
The majority of the small businesses surveyed suggested they could only afford to increase their hourly rates by 0.34 cents – less than half of what the increase was at 0.64 cents.
In an effort to cover their rising wage costs SMB owners are considering a number of actions such as raising the price of products or services (30.3 per cent}, reducing the number of staff (21.3 per cent) and cutting staff shifts (19.1 per cent).
Only 12 per cent of those surveyed said the wage rise would have no impact on their business.