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Sunday, November 29, 2020

Self-employed Australians take big financial hit

More than 80% of self-employed Australians say their profits have taken a significant hit because of COVID-19 restrictions, new analysis from The Australian National University (ANU) shows.

Professor Matthew Gray and Professor Nicholas Biddle from the ANU Centre for Social Research and Methods surveyed over 3,100 Australians for their research, which showed more than four in five self-employed Australians report a negative effect on their profits.

“For many of these people, the loss was quite large. About one in 20 (5.1%) said that the coronavirus had eliminated their profits completely, 21.6% said it had been reduced to its lowest point ever and 21.9% said that COVID-19 has reduced their profits substantially,” Professor Gray said. 

“That is, almost half of the self-employed population in Australia feel that COVID-19 has already had at least a substantial effect on their profits.”  

The survey also found almost one-third (31.6%) of self-employed Australians don’t think their businesses will be economically viable in the next two months if the economy continues tracking the way it has.

“This increased to two in five (40.1%), when self-employed Australians were asked if they thought their businesses were economically viable in the next six months,” Professor Gray said.  

The survey also shows self-employed Australians have lost more work hours than other Australians because of the COVID-19 restrictions (9.3 hours per week for the self-employed compared to 3.1 hours for employees) and have lost more income ($66.70 per week more than other employees).

The self-employed are almost three times as likely to have accessed retirement savings or superannuation early compared to employees. 

Professor Gray called on our leaders to consider how “these many hard-working Australians, who not only give a great deal to our economy but also our society and communities” can be taken care of during and after the COVID-19 pandemic.

“Clearly, self-employed Australians are really feeling the heat when it comes to the economic impact of COVID-19.  

“Our survey shows this is also causing significant distress and taking a toll on their mental health,” he said.

The analysis is available from the ANU Centre for Social Research and Methods website.

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