Q&A panellist says unemployed should start their own business, but SMEs still face barriers in hiring and raising capital

Industry leaders say a small business industrial award would make it easier for small businesses to hire more staff, following a suggestion made last night on the ABC’s Q&A program that struggling workers should just “start their own businesses”.

Industrial relations expert and News Corp columnist Grace Collier appeared on the panel last night and answered questions from the audience about the future for workers with basic skills in Australia, reports the ABC.

Greens leader Richard Di Natale, Australian Council of Trade Unions president Ged Kearney, Labor MP Tim Watts, economist Judith Sloan, and Public Affairs executive director John Roskham were also on the panel.

The discussion in part centered on the manufacturing industry, and specifically if the government should subsidise certain industries in order to provide jobs and keep the industries healthy. When asked her opinion by host Tony Jones, Collier prefaced her statement by saying: “I’m going to offend everybody in the room”.

“Nobody has an entitlement to a job. Society doesn’t owe you a job. The Government can’t get you a job. The Government shouldn’t have to get you a job. There’s no such thing as Government money. There’s your money and my money,” Collier said

“In reality, there is one person in this world who can guarantee a happy future for you, and that person stares at you in the mirror every morning.”

Collier continued to outline how she herself had previously been sacked from jobs and had “flops and successes” in starting her own businesses.

“Everybody has something that they’re good at. You work out what you’re good at and you try and make a career out of that,” she says.

Greens leader Richard Di Natale fired back at Collier, saying there “are more people than jobs, that’s why we have an unemployment rate”.

“People can start their own businesses,” Collier responded.

“It’s terrible isn’t it? Wouldn’t it be awful to have to start your own business because someone else has to give you a job?” she said.

Employment difficulty a barrier to growing young businesses

Collier’s outlook prompted a backlash from her fellow panelists, but Council of Small Business Australia chairman Peter Strong agrees – although he admits more needs to happen to make it easier for Australians to start and grow their own businesses.

“She’s right, that’s where the future will lie. We need to look more at the barriers in growing a business, not starting a business,” Strong says.

“When businesses come to the stage of growing the business and employing staff, that’s the real issue. Some businesses find that so difficult that they just don’t employ anybody.”

Strong believes a small business industrial award would go a long way towards increasing the number of successful SMEs.

“I’ve had so many businesses come to me and express how surprised they were at how hard it was to employ their first employee,” Strong says.

“When it gets to 15 staff or more, some just don’t bother. We need a small business industrial award, it has got to be looked at.”

Australian Small Business and Family Enterprise Ombudsman Kate Carnell shares a similar view, telling SmartCompany “simple compliance guidelines” are required for self-employed people wanting to grow a business.

“The questions surrounding employing your first person are very real. Many businesses like cafes and restaurants have people employed under 3-4 different awards,” Carnell says

Read more: Cafe owners and retailers leading Australia’s entrepreneur boom: Survey

“If you want to encourage people to set up their own businesses, we have to make it easier for them to do that.”

Carnell also agrees with Collier’s comments, remarking, “It’s not that ridiculous,” and highlighting the 1 million businesses in Australia who don’t employ anyone but are successful.

The struggle for start up capital

Collier’s comments prompted heckling from the Q&A audience, along with a lot of digital heckling coming from Twitter.

“Grace Collier: “Unemployed? Start a business.” um, half of new businesses fail and you need start up capital. Fail, you go broke,” one Twitter user commented.

grace collier: cant find a job? start a business
me: i cant because i have no money because i dont have a job
collier: start a business!

— thomas violence (@thomas_violence) October 17, 2016

Both Strong and Carnell agree with the view that hopeful business owners often encounter difficulties accesses capital, with Strong saying “we need to confront the difficulty young people have getting loans”.

“[The Australian Prudential Regulation Authority] has said smaller businesses are a higher risk when it comes to loans, and I challenge that,” Strong says.

“Not to mention the red tape required to get a $5 million loan is less than the red tape for a $40,000 loan.”

Carnell believes “disruptive lenders” are the future for small businesses, acknowledging they are making it easier for business founders to get loans.

“It’s good to see an increasing number of these disruptive lenders popping up, we need more alternative lenders to the banks,” she says.

However, she believes there is still a “significant gap” in the lending market.

“$20,000 to $50,000 loans are fine for most new business owners, but for someone wanting to buy a café, the amounts are bigger,” Carnell says.

“If we want to make it easier for first-time business owners, we need to address this significant gap in the market.”