How we can get retail sector back on its feet

The retail sector is the largest private sector employer. Picture: Monique Harmer

Most Australians have a strong connection to retail – whether it be a first job, a career step or a connection to someone who works in retail or owns a business. And we are all consumers.

Retail is also the backbone of our economy – as our largest private sector employer, which contributes 18 per cent of the nation’s GDP. We can’t have an economic recovery without a retail recovery, which is why the sector must be a priority focus at the March federal budget.

After five years of weathering the storms of low consumer spending, rising business costs, high interest rates and a retail crime wave, it’s time to help get this important sector back on its feet. Retailers are calling for support measures that will grow the industry, bolster the workforce, and help secure positive outcomes for the broader community.

Retail crime is an intense and urgent issue, with store theft and staff assaults causing emotional distress and significant financial setbacks for teams around the country. This must be a national focus and a leadership priority. Funding for a national crime prevention strategy, including a centralised reporting system and technology-driven solutions, is vital to protect workers and businesses.

Global conflicts, flooding, strikes and cybercrime attacks have knocked our supply chains around in recent years. The situation remains fragile.

A supply chain commissioner and targeted infrastructure investment is urgently needed to address supply chain disruptions and rising costs, ensuring retailers can continue to serve their communities efficiently by having consistent access to quality products.

Australian Retailers Association chief industry affairs officer Fleur Brown.

The last few years have seen intense government reforms, adding many layers of regulatory complexity and reporting for business. Business needs to be free to operate and grow – not tied up in red tape. We need to see a national taskforce aimed squarely at that purpose. National harmonisation of regulations is now urgent – whether it be payroll taxes, retail leasing, environmental policies, and workplace safety. Navigating an inconsistent patchwork of rules across states is costly and inefficient for businesses, particularly small and medium-sized businesses.

Tax relief is critical to encourage mid-sized retailers to reinvest in growth and job creation. This measure would provide relief to retailers that have experienced higher costs and cashflow challenges over the past three years.

We must also see the Instant Asset Write-Off scheme become permanent with increased thresholds to encourage businesses to invest in technology, innovation, and productivity-boosting assets.

Retailers are helping lead the transition to a more sustainable economy. Government investment in recycling infrastructure, a national circular economy framework, and incentives for low-carbon logistics will ensure the sector can contribute to Australia’s environmental goals, while maintaining profitability.

Labour shortages remain high and, along with skills gaps, constrain the growth of the sector.

We also need to see clearer career pathways for young people, greater access to training, and targeted policies to encourage workforce participation from under-represented groups.

More funding should be directed to private registered training organisations (RTOs) to provide flexible and industry-relevant learning options. Incentives for completing retail certificates should be reinstated to encourage skill development and career progression.

Digital transformation is a priority. Investment in e-commerce capabilities, cybersecurity protections, and digital literacy training will help businesses remain competitive in an increasingly online-driven market. AI can revolutionise how businesses – both large and small – engage with customers, save money, streamline services and offer personalised experiences. Encouraging retailers to embrace digital tools will enhance customer experiences, streamline operations, and help compete with global players.

With the right support, the retail sector can drive economic recovery, job creation and community wellbeing. The upcoming budget must reflect retail’s importance by reducing regulatory barriers, incentivising workforce participation, and fostering a safer and more sustainable industry.

Retailers have weathered unprecedented challenges in recent years but have also shown remarkable resilience in the face of many setbacks. With strategic government support, they can emerge stronger.

Now is the time for policymakers to recognise retail’s vital role and ensure its continued success for the benefit of all Australians.

Fleur Brown is chief industry affairs officer at the Australian Retailers Association.