At the same time, the Australian Retailers Association is in crisis with the worst labour shortage it has experienced in decades and limited choice of workers.
The Australian Chamber of Commerce and Industry is hoping the issue will be discussed at the government’s upcoming employment summit, and said giving pensioners the choice to return to the workforce would be a boost for Australian businesses struggling to find staff.
“Older Australian workers with invaluable experience and skills would be a much-needed boost to the workforce,” ACCI chief executive Andrew McKellar said.
“By removing the barriers for pensioners who want to work, we can make a real difference in their lives and also help businesses struggling to find staff.
“The wealth of knowledge and experience that our aged pensioners could bring back into our workforce would help close the skills gap and encourage knowledge to be passed to younger workers.”
Around 60 per cent of Australians support changes that would allow retirees to work unlimited hours without losing any of their pension.
“ACCI is heartened by the bipartisan approach to considering this policy and acknowledges Treasurer Jim Chalmers and Opposition Leader Peter Dutton for discussing the idea,” Mr McKellar said.
Last year, ACCI and its state chamber network called on the government to encourage more pensioners back into the workforce by allowing them to earn more income without losing benefits.
“The disincentive for aged pension recipients to re-enter the workforce is significant. Currently, a pensioner can earn an average of $480 a fortnight, or $12,840 a year, before their payments are reduced,” Mr McKellar said.
“This is the equivalent of only one day a week at the minimum wage before their pension is reduced resulting in an effective marginal tax rate of at least 50 per cent.
“The shortage of skills and labour is the number one challenge facing business across the country. If businesses don’t have access to the workers they need, they cannot operate at full capacity, and cease to remain internationally competitive.”
Meanwhile, labour shortages continue to cripple the retail industry with employers saying the situation has gotten worse over the past three months.
In a survey of members, the Australian Retail Association discovered that 61 per cent of retail businesses said labour shortages have gotten worse, or much worse, over the past three months.
In fact, no respondents to the online survey said labour shortages have improved and only 39 per cent said the situation has stayed the same.
Over 80 per cent said it is becoming much harder to find and recruit new team members and 73 per cent said job vacancy rates are worse than business as usual.
And it’s not just finding staff, it’s keeping staff with more than half (55 per cent) of retailers saying absenteeism rates are worse, or much worse, than three months ago.
ARA CEO Paul Zahra said the labour and skills crisis must be urgently addressed.
“Retail businesses are fundamental to Australia’s economy and our daily lives, and they simply can’t get enough staff,” he said.
“This has been an issue through the pandemic which has intensified this year and what’s worrying is that things are not getting any better. The labour and skills crisis are in addition to the intense cost pressures businesses are facing, with rents increasing along with fuel and energy costs and supply chain constraints. It is a dire situation for many small businesses, who are struggling to keep their heads above water.”
Mr Zahra said with the tightest labour market in more than 50 years, it is clear that traditional recruitment methods are not working.
“We need to see some practical solutions so businesses can access a bigger talent pool, which would allow them to trade closer to their full potential,” he said.
“We continue to call on the federal government to allow employment income to be exempt from the age pension income test. This would mobilise a willing and able cohort of workers and allow pensioners to supplement their income, work more hours and help address the staffing challenge.
“Without government intervention, the labour and skills crisis will only deteriorate further and push some businesses to the brink. You cannot have an economic recovery without a retail recovery, and this is also a major handbrake on growth and productivity.”
