Following its Annual Wage Review 2021-22, the Fair Work Commission (FWC) has announced the National Minimum Wage will increase by 5.2 per cent, while award minimum wages will increase by 4.6 per cent, which is subject to a minimum increase for award classifications of $40 per week (based on a 38-hour week for a full-time employee).

Australia’s peak body for restaurants, cafes and catering businesses, Restaurant & Catering Australia (R&CA) is concerned that this increase will compound inflationary pressures on businesses who are already struggling to recover in the wake of the COVID-19 pandemic.

R&CA CEO Belinda Clarke stated that the minimum wage increase will make it harder for small businesses to keep people employed.

“Ninety-three per cent of our industry is small business. With everything they have gone through over the past two years with COVID-19, in addition to rising inflation, crippling staff shortages and the cost of doing business, this is sadly going to mean more business closures,” Ms Clarke said.

“Whilst we are glad that the Commission agreed with our submission in deferring the implementation of the award rate increase to 1 October, I know a lot of business owners will have limited ability to absorb the extra cost.

“We will continue to fight for the industry and work with government to make sure that there is an environment for businesses and their workers to flourish,” she said.

Brezel Authentic German Bakery owner Michelle Roth told Baking Business the news was scary for small business owners.

“With consumer confidence being low and us still recovering from COVID-19 lockdowns and floods etc., we’re struggling to get customers to spend their money,” Ms Roth said.

“As a business owner it makes it pretty hard to afford higher operational and fixed costs when there’s not more revenue coming in and margins are already pretty tight.

“Our staff deserve all the money they can get, of course, as they all work so hard and passionately but on the other side customers don’t want to spend more on products either which makes it a very conflicting situation.”