More than 76% of small and medium business operators want the Reserve Bank board to cut interest rates by 0.5%, according to a SmartCompany poll.
More than 76% of small and medium business operators want the Reserve Bank board to cut interest rates by 0.5%, according to a SmartCompany poll.
Asked whether interest rates should remain on hold or fall by 0.5% or 0.25%, a whopping 76.5% of respondents said they favoured a deep cut of 0.5% to kick start the economy, while 14.7% want a cut of 0.25% Just under 9% say rates should remain on hold.
The survey of 67 business operators also reveals how hard companies have been hit by 12 successive interest rate rises since May 2002, with 88.2% of respondents reporting that high interest rates had negatively affected their business.
This contrasts dramatically with a SmartCompany poll in February, when just 28% of business operators said they were being effected by higher rates.
About one third of respondents said higher rates had forced them to cut staff numbers, with 64.9% reporting they have been forced to cut costs in order to stay profitable.
Just as worryingly, higher interest rates have bought SME growth to a halt.
Just under 60% of respondents said they had delayed expansion plans as a result of higher rates, with 47.4% saying they had postponed business investment and almost 55% saying they had delayed hiring decisions.
SmartCompany received a number of impassioned pleas for the RBA to give SMEs some rate relief.
“I’d like the RBA Governor Glenn Stevens to tour the Sunshine Coast. We have seen an unprecedented number of businesses close their doors here this year. How much business carnage will be enough?” one reader asks.
“I say cut by 0.5% and then see what happens, as 0.25% is hardly enough, given the banks have bumped up their rates. If Glenn Stevens could walk a mile in self-employed shoes, he’d be singing another tune. He has no idea.”
SmartCompany will keep you updated with the latest on the RBA board meeting as soon as an outcome is known, so don’t forget to check back around 2:30pm.
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
