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Economic Crossroads

The Five Key Questions and What They Mean for Small Businesses

Easing the Cost-of-Living Crisis

Rising living costs put pressure on small businesses. Consumers spend less, suppliers raise prices, and staff require higher wages to cope with inflation. The BCA suggests improving productivity, reducing red tape, and managing government spending more effectively. While these measures aim to strengthen the economy, they do not provide immediate relief for small enterprises struggling with cash flow.

One potential solution is targeted tax relief for small businesses, such as reducing payroll tax or increasing deductions on essential expenses. Direct financial support, like temporary energy rebates or business rate reductions, could also help ease operational costs. Encouraging local spending through government-backed small business incentive programs may keep money circulating in local economies, allowing businesses to remain viable despite economic pressures. A broader focus on supply chain efficiency and cost reduction at the wholesale level could also prevent price hikes from being passed down to small businesses.

Tackling the Housing Crisis

The housing crisis affects small businesses in multiple ways. The high cost of housing pushes wages up, impacts staffing as employees struggle to afford rent in metropolitan areas, and challenges small construction, trade, and property-related businesses. The BCA proposes improving planning approval processes, increasing infrastructure investment, and reforming taxes related to housing development. These strategies could help address supply shortages but may take years to show results.

A faster approach may be providing incentives for small construction firms and local suppliers to participate in affordable housing projects. Tax relief or grants for small-scale developers and independent landlords could encourage more rental supply. In addition, creating business hubs outside of major cities with strong infrastructure investment could reduce reliance on expensive metropolitan areas, providing relief for businesses and employees. Rent stabilisation for commercial properties could also help small businesses maintain their premises without being priced out by rising lease costs.

Achieving Net Zero with Affordable, Reliable Energy

The shift towards net zero presents both challenges and opportunities for small businesses. Many face rising energy costs, while others see new market opportunities in sustainable services and products. The BCA advocates for a technology-agnostic approach, business-government collaboration, and a clear transition plan to ensure energy remains affordable and reliable. However, transitioning to sustainable practices requires investment that many small businesses cannot afford without financial support.

Grants and tax incentives for businesses adopting renewable energy solutions could accelerate the shift without placing undue financial pressure on small enterprises. Access to low-cost financing for green upgrades—such as energy-efficient machinery, solar panels, and electric vehicle fleets—would reduce long-term operating costs while supporting environmental goals. Establishing renewable energy hubs for small businesses could provide affordable access to clean power, ensuring energy price fluctuations do not disproportionately impact them.

Developing a Skilled Workforce for the Future

Skills shortages are one of the biggest challenges for small businesses, making it harder to find and retain qualified employees. The BCA suggests long-term education reform, improved industry partnerships, and a greater focus on lifelong learning. While these reforms could build a stronger workforce over time, many businesses need immediate access to skilled workers to stay competitive.

Expanding vocational training specific to small business needs could help address these shortages quickly. Providing wage subsidies for apprentices and trainees could encourage businesses to invest in upskilling staff. A more flexible visa system for skilled migration in industries with critical shortages could offer short-term relief, ensuring businesses do not suffer due to a lack of available talent. Digital learning platforms with industry-specific courses also provide small businesses cost-effective training options, allowing them to develop their workforce in-house.

Stronger collaboration between businesses and education providers could help bridge the skills gap by ensuring training aligns with industry needs. Creating pathways for students to gain practical experience in small enterprises could increase workforce readiness while giving businesses access to fresh talent. Expanding government-backed recruitment assistance programs could further support small businesses in finding and retaining skilled employees.

Delivering the Health and Care Services Australians Need

Healthcare is not just a public service issue—it is also a significant sector for small businesses, from independent medical practices to aged care providers and allied health professionals. Rising demand, workforce shortages, and funding pressures create ongoing challenges. The BCA highlights the need for efficiency improvements, digital health adoption, and long-term funding solutions. However, small businesses in the sector often struggle with excessive regulation and financial constraints.

Reducing compliance burdens for small healthcare providers could improve service delivery while lowering operational costs. Investing in digital health technology, such as telehealth platforms, could help businesses reach more patients efficiently. Funding programs that support small healthcare providers in regional and rural areas could improve access while allowing these businesses to grow. Encouraging partnerships between small healthcare operators and larger providers could also help share resources and knowledge, strengthening the sector overall.

Expanding tax incentives for businesses that provide private health coverage to employees could reduce strain on public healthcare while improving workforce productivity. Supporting the training and retention of healthcare professionals through targeted subsidies or flexible accreditation processes could ensure that the sector remains sustainable. Balancing regulatory standards with business practicality is key to ensuring small enterprises thrive in healthcare and related industries.

Preparing for the Future

The Business Council of Australia’s “Big Five” challenges outline major economic issues shaping the coming years. However, small businesses require policies that address their immediate needs while supporting long-term resilience. Economic uncertainty is unavoidable, but preparation and strategic decision-making will help businesses navigate these changes.

Understanding the challenges, identifying practical solutions, and engaging in proactive planning will enable small businesses to adapt and succeed. Today’s right approach can position businesses for future growth, regardless of economic shifts.

For expert guidance on how these economic changes may impact your business, book an appointment with SBAAS today. Our consultants provide tailored strategies to help small businesses navigate complex challenges and secure long-term success. Learn more about our services on our About Us page.

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Picture of Eric Allgood

Eric Allgood

Eric Allgood is the Managing Director of SBAAS and brings over two decades of experience in corporate guidance, with a focus on governance and risk, crisis management, industrial relations, and sustainability.

He founded SBAAS in 2019 to extend his corporate strategies to small businesses, quickly becoming a vital support. His background in IR, governance and risk management, combined with his crisis management skills, has enabled businesses to navigate challenges effectively.

Eric’s commitment to sustainability shapes his approach to fostering inclusive and ethical practices within organisations. His strategic acumen and dedication to sustainable growth have positioned SBAAS as a leader in supporting small businesses through integrity and resilience.

Qualifications:

  • Master of Business Law
  • MBA (USA)
  • Graduate Certificate of Business Administration
  • Graduate Certificate of Training and Development
  • Diploma of Psychology (University of Warwickshire)
  • Bachelor of Applied Management

Memberships:

  • Small Business Association of Australia –
    International Think Tank Member and Sponsor
  • Australian Institute of Company Directors – MAICD
  • Institute of Community Directors Australia – ICDA
  • Australian Human Resource Institute – CAHRI
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