Retailers said they are being put at risk as the Reserve Bank of Australia (RBA) decided to keep interest rates at 4.35 per cent this month.
RBA Governor Michele Bullock said that the central bank maintained the current rates as inflation has significantly declined since its peak in 2022.
The RBA said that real disposable incomes have stabilised and are expected to improve later this year, supported by lower inflation and tax cuts.
“Retail trade and consumer confidence are at an all-time low, putting Australia’s second largest employer at serious risk,” Rob Godwin, National Retail Association (NRA) director, said. “The latest 3.75 per cent bump to the national minimum wage and minimum award wages, plus the increases to superannuation, will put more pressure on struggling retailers.”
Godwin added that the NRA’s workplace relations team received inquiries concerning redundancy and restructuring from January to May that were more than twice the number of such inquiries in the same period last year.
“Our sentiment report shows 78 per cent of retailers highlighted wage costs as one of the top three constraints to their business’ success in 2024,” Godwin said. “Many are also being impacted by high insurance premiums and energy costs.”
The NRA urged the RBA to start the new financial year with a rate cut.
This story first appeared on our sister publication Inside Retail
