It’s time Australia embraced a 24-hour economy to get people back into our CBDs

Australian Retailers Association chief executive officer Paul Zahra.

Australia’s ministers and treasurers will soon be locked in a high-stakes game of economic Jenga.

Industries will serve as the vital building blocks while economic headwinds precariously teeter the tower from side to side.

Much like in Hasbro’s tabletop classic, this metaphorical economic Jenga tower will become unstable and collapse if too many industries are taken out of play.

As a $400bn sector that employs one in 10 Australians, retail holds the structure together like mortar.

If retail falters, the reverberations will be felt far and wide.

In another year of economic uncertainty, sensible government policy will be paramount for business success – which will in turn power our economic recovery.

While the industry lauded record-breaking sales in 2022 – with the pre-Christmas spend the biggest ever – those results came with an asterisk.

Up to two thirds of the recent growth in retail spending has been driven by price increases due to inflation.

And with the high cost of doing business, supply chain disruptions and staff shortages, it is shaping up to be a tumultuous time for retailers when the economic tide turns at some point this year.

The federal budget in May is always an important milestone in advocating for improved outcomes for the sector. The focus of our federal conversation this year must look towards the future.

Ensuring retailers – in particular small businesses – are on strong and sustainable footing moving into 2023, is essential.  

In doing so, we need to acknowledge that the world has changed and our CBDs, which are depleted of office workers choosing to work from home, need a new strategy.

Embracing a 24-hour-economy is essential.

We should encourage visitors back into Australia’s largest CBDs and regional locations. The CBD retail machine is a key barometer of economic success and we need a new strategy that takes us from day to night.

Also vital will be encouraging overseas tourists to spend more in the local retail economy by investing in innovation of the Tourist Refund Scheme and, as a minimum, aligning Australia’s duty-free liquor allowance with New Zealand’s.

While I speak about the benefits for retail, the positive effects of these initiatives would trickle across all industries.

Another area that requires urgent government attention is chronic labour shortages.

The scale of this crisis continues to worsen. The latest figures from the Australian Bureau of Statistics show 49,900 vacancies across the retail sector in November 2022 which was an increase of 8.2 per cent compared with August 2022.

To address this, we need to put ourselves in the shoes of those who are not taking up these job opportunities.

Two anecdotal examples immediately come to mind.

The first is the stay-at-home parent, caught in a Catch-22 situation. It’s a no-win situation when a mother has to choose between sacrificing work to look after the kids or taking up a job just to pay for childcare.

And I say a mum because whilst dads are affected, this issue disproportionately affects women.

The ABS found that in 2020-21 there were 250,000 women who wanted a job, or to work more hours, but were unavailable. Of that number, 61,600 (25 per cent) cited caring for children as the main barrier.

And this is only one frontier of the untapped workforce in our country.

Also too is it important to further support the long-term unemployed, ensuring access to sustained work; it’s time to reconsider how we help people living with a disability to find meaningful work.

Revisiting our Jenga analogy, smart government policy and initiatives is the mortar that binds our tower together.

The ageing population is another frontier of the workforce but one that is a success story for sensible government intervention.

The Pensioners Credit Scheme, which allows aged pensioners to earn an additional $4000 without losing any of their payment entitlements, has been a boon for workforce participation.

This scheme will continue until 31 December 2023, but we are urging government to retain it into the future.

To think that a country with such a small population has different minimum age requirements by state and territory seems ludicrous. Surely it’s time to provide a national policy to the minimum working age?

Most Australian students had their first job in retail and hospitality – an industry that provides incredible professional development, and life skills for that matter.

Employment is crucial for economic stability as it drives spending, which in turn drives economic growth. And retail is very much at the coalface of spending.

It is not the be all and end all though, with supply chain resilience and sustainable business outcomes also serving important economic purposes.

As consumer spending tapers, the effects will be felt across the economy. Being proactive is key.

In Jenga, certain blocks serve as the foundation, the strength that keeps the tower upright. Retail fits that bill.

Paul Zahra is chief executive of the Australian Retailers Association