The release today of the 3% increase to the industry award wage rate was a serious blow to the survival of the independent retail industry according to Mr Jos de Bruin from MGA Independent Retailers (Master Grocers Australia). He said, "We are extremely disappointed by the Fair Work Australia decision to add 3% to the two previous annual increases of 3.5% in 2018 and 3.3% in 2017. How can retailers cope with a 9.8% increase in wages over three years, not forgetting the other increases in awards that have happened in the past year, at a time when inflation is at an all-time low, sales are stagnant and the economy is vulnerable?"
Mr de Bruin continued, "Our members are supermarket, liquor store and timber and hardware retailers. Most of them are family owned businesses who work long hours and struggle to make a small profit with sales that have very narrow margins. We submitted our reasons to the Commission as to why we believe that a further increase in wages of the size that has been granted is just unsustainable. We explained to the Commission that already our retailers are reducing the hours that their employees are working. They are employing juniors to reduce their labour costs, although they would love to employ more senior staff. They want to keep their loyal employees but they just won't be able to do that. This new rate will cause serious damage to their sustainability and many will have no alternative but to close their doors."
Independent retailers compete against the might of larger stores and overseas discounters who are in the markets too, who are able to defray wage costs through automation whilst the independent sector through its customer service model employ more people pro rata.
Our independent retailers fight to remain competitive but when they have high wage increases forced on them year after year they ask the question, 'How can we survive?'
Mr de Bruin concluded, "Why doesn't the Commission consider giving some respite and provide a small increase to the award wage rate for at least one year? This would allow retailers to build their businesses and keep their heads above water for a short time. Past wage increases have had a damaging impact and no matter how we try to impress our concerns we are hit with yet another high percentage increase. But it's all to no avail and it seems family enterprises and private businesses will continue to be bombarded with higher wages year after year until they are eliminated"
Jos de Bruin
CEO
MGA Independent Retailers (Master Grocers Australia Ltd)
