New research has revealed that 72 per cent of business owners admit that Government stimulus measures have been essential in their enterprises’ survival in the face of the economic difficulties due to the COVID-19 pandemic.
The findings, from a survey of an independent panel of Australian business owners commissioned by online finance information platform Money.com.au, show that 69 per cent of the respondents accepted JobKeeper payments to retain employees, 16 per cent received tax-free payments through the cashflow boost scheme, while 14 per cent claimed deductions on eligible asset purchases under the instant asset write-off measure.
The report also noted that 69 per cent of business owners cited JobKeeper as the most helpful stimulus measure, followed by instant asset write-off and cashflow boost (14 per cent) and SME Guarantee Scheme (three per cent).
The data also reveals the extent to which these measures helped business performance during the country’s economic downturn. One in five business owners (19 per cent) said their businesses did better than last year, and 35 per cent did the same as last year, thanks to the stimulus measures. However, nearly half (45 per cent) said they were worse off this year.
“With many stimulus packages set to wind down next year, including further cuts to JobKeeper in January, it’s likely that ‘zombie’ businesses who have kept afloat this year due to Government incentives will cease to exist next year Licensed financial advisor and Money.com.au spokesperson, Helen Baker, said. “It is important for business owners to pivot their offering and service if they are struggling and look for other ways to increase revenue. Reworking relationships with suppliers and clients will be particularly crucial during this time.
“Interestingly, the SME Guarantee Scheme had low take-up by businesses, despite providing access to additional funding and cheaper credit,” Baker added. “This may be because business owners viewed loans as too risky this year – with widespread uncertainty due to the global impact of COVID and the recent US election, along with ongoing trade tensions with China. This has forced many industries to look to alternative markets. Business loans may prove more useful next year as business owners begin to focus on pivoting and recovering.”
