The government must implement the tech and skills boosts ASAP to unlock productivity growth for SMEs
If productivity is Australia’s goal, making sure every business is a digital business needs to be a major priority, writes MYOB’s Helen Lea.
I’ll start with an understatement: Australia’s small businesses have had a rough ride these past few years. They’ve faced the effects of the pandemic and come out the other side to struggle with skills shortages, supply chains and inflation. It’s no wonder they’ve reported increased mental health pressures in the face of all this flux, with 56% of SME owners indicating running their business has had a direct impact on their experiences of anxiety or depression.
These are not issues with an easy solution. The effects of our post-pandemic environment are so wide-ranging that it’s hard to know where to begin; replenishing the talent pipeline and tackling the cost of living are weighty problems that require multi-layered strategies and time to resolve. What we need right now, while the bigger thinking is underway, are bite-sized solutions — small steps we can collectively take to help us through.
The Technology Investment Boost and Skills and Training Boost, once legislated, will provide a pathway on which SMEs can take these small steps.
Recent MYOB research found 73% of SMEs reported improving their business practices would ease feelings of stress, and the June 2022 MYOB Business Monitor found 26% consider the cost of online technologies to be a cause of extreme or quite a lot of pressure.
The opportunity to upskill their people and embrace the efficiencies of digital fluency would empower Australian small businesses to rise to current challenges and improve their business practices.
MYOB modelling shows that almost half a million of Australia’s small and medium-sized enterprises (SMEs) — one in five — have no or low levels of digitisation. And yet for those that do digitise, the benefits are real. Businesses with meaningful digital engagement are 50% more likely to grow revenue. They are eight times more likely to create jobs. They are 14 times more likely to innovate and come up with new products or services. If productivity is the goal, making sure every business is a digital business needs to be a major priority.
For the one in five Australian SMEs that are struggling with digital fluency, we know that change will take time. Under the current timeframe of the legislation, due to end June 30, 2023, this is time they do not have. Having the space to provide education around the benefits of a digitally upskilled business will position SMEs well for that first step.
Both incentives working hand-in-hand
At the Jobs and Skills Summit, the Treasurer said, “productivity flows from investing in our people and their ability to adapt and adopt new technology”. Training and investment in technology will help SMEs to deliver on the government’s future-focused skills agenda, and we need programs that are relevant to future and current job needs.
Those needs rely on a comprehensive understanding of digital platforms. The Skills and Training Boost will be at its most successful if it is delivering upskilling opportunities on digital engagement for SMEs. But without access to those digital platforms via the Technology Investment Boost, the training can’t occur.
That’s why we’re calling on the Technology Investment Boost to be extended to the same timeframe as the Skills and Training Boost, set to end on June 30, 2024, to ensure SMEs can maximise this once-in-a-lifetime opportunity to maximise their integration with the digital economy. Australia’s enhanced productivity is at the core of our rationale, with every dollar invested in SME digitisation returning $25 to economic growth.
An SME productivity boost is imminent
Digital adoption among SMEs has been an issue in play for a while. The good news is, we now have a strong legislative way forward to bridging that gap for the digital betterment of SMEs. MYOB was delighted to see both boosts progress to draft legislation. For the reasons outlined — this is timely against a backdrop of economic complexity.
What is crucial now is creating certainty for Australia’s SMEs. Implement the boosts as quickly as possible so businesses can have the confidence to invest in their businesses and staff — and take that first small, but valuable, step to recovery.
Helen Lea is the chief employee experience officer at MYOB.
