Even as the COVID-19 pandemic continues to affect the country, small business – particularly those belonging to the healthcare, manufacturing and construction sectors – have expressed optimism on the state of their industries for the rest of 2020.
Xero’s Rebuilding Australia: the role of small business report offers in-depth analysis into how SMEs have fared during the COVID-19 crisis, as well as opportunities for the revival of the small-business sector beyond the pandemic.
The report reveals that, while some sectors are optimistic, small businesses in professional services, accommodation, food and the education industries are the least confident about their business’s outlook for the rest of the year. Overall, 48 per cent of small-business owners stated they are are optimistic about their prospects in the second half of this year, and 23 per cent expect revenue to jump up by more than 10 per cent by December.
“Here we are in the middle of both a pandemic and the worst recession in three generations,” Bernard Salt, social commentator and the report’s author, said. “The fact that half of all small businesses remain optimistic about their prospects in the second half of the year says something about the sheer determination and inherent optimism of the small-business community in Australia.”
The report also noted a surge in demand for skills in technology and in home improvement during the lockdown as small business made the online shift and workers were improving their new home office. It cited a reported 215 per cent increase in the number of workers employed as multimedia specialists and web developers, and a 15 per cent for those in the plumber workforce. There’s also a surge in the creative workforce with the number of employees working for canvas and leather goods makers increased by 89 per cent while fashion and jewellery designers increased by 48 per cent.
“Small business has long been the backbone of Australia’s economy, and so when the pandemic hit, the sector bore the brunt,” Trent Innes, Managing Director, Xero Australia and Asia, said. “Data from the Rebuilding Australia report sheds light not only on how resilient businesses have fared in navigating the uncharted waters presented by the COVID-19 crisis, but it also delivers valuable insights into what it takes to operate a small business, to adapt in challenging times, and to remain confident of coming out the other side, even stronger.
“We also see that the pandemic has hastened the adoption of digital trends by businesses, highlighting the importance of continued investment in digitisation in the revival of our small business economy,” Innes added.
The report highlighted the importance of SMEs’ agility, with 25 per cent of small businesses that thrived during the pandemic having adapted their operations, while 39 per cent found new customer markets. Flexible working hours (30 per cent) and remote working arrangements (28 per cent) were also cited as key factors. Another theme is investment in technology, with 35 per cent expecting to increase their investment in tech even further in the next three months.
“Small businesses that have prospered during the pandemic may well have been in the right industry at the right time but, according to the survey, the best-of-the-best adapted, found new markets and invested in technology,” Salt said.