Budget 2022 preview: What businesses are expecting from the upcoming ‘resilient’ budget

Budget 2022 preview: What businesses are expecting from the
upcoming ‘resilient’ budget

Treasurer Jim Chalmers has promised a “solid and logical” federal budget. The budget’s launch coincides with increased global economic volatility, fears of a generalised global slowdown, and mounting home pressures, all of which negatively impact household budgets.

Here is a summary of what our experts believe should be included in the budget. The budget will show that economic expansion is slowing due to greater cost-of-living adjustments by consumers. This fiscal year, the Australian GDP is anticipated to expand by 3.25 per cent before slowing to 1.5 per cent growth in 2023–2024. 3.5 per cent GDP growth this year and 2.5 per cent the following year were predicted in the March budget.

The CEO of Navii, Liz Ward, emphasises the value of digitisation for businesses and how budget priorities should favour SME digitisation. “SMEs want to be trusted, relevant, and practical support to gain knowledge, confidence and skills to prioritise strategies and tasks to digitise their businesses, as they don’t have these resources or the required knowledge in their small teams.”

“Digitisation is pervasive across all business areas and is not just about marketing.  SMEs need access to an array of digital expertise, for example, to help with cyber security, tools to drive efficiencies in their operations, planning and prioritisation of digital investments, online presence and digital marketing.”

“Technology is advancing at a quickening pace, making the continued focus on digitisation a requirement always in SMEs. We must continue to have initiatives in our Government’s budgets to support digitisation in SMEs as we see through our programs that businesses who take advantage of funded support and engage in the opportunities presented by coaching and practical SME-focused education programs can achieve tangible results.” 

“Recent data insights gleaned from Navii’s sister platform TourismTribe.com shows that 963 tourism & hospitality businesses who participated in a digital improvement program between October 21 and October 22 were able to achieve, on average, a 9.7 per cent improvement in their foundational digital marketing assets (websites, search, online reputation, Facebook & Instagram), measured over a timeframe of approximately three months.”

What the tech sector wants from budget 2022 

The Tech Council of Australia has been vocal in stating that we need an additional 650,000 tech workers within the next eight years to meet the 2030 target of 1.2 million workers in Australian tech jobs, and while the Federal Government addressed this in the recent Jobs Summit by providing funding for apprenticeships and vocational pathways, more needs to be done. 

“It’s fine to fund new university courses and talent, but to get to 650,000 new jobs, we need to think differently,” says Tristan Sternson. We need to attract new job reskilling, not just graduates, while also investing more in schools and curriculum to guarantee that kids finish school and pursue employment in technology.

“To increase the talent pool, we must move beyond the major cities and look to regional areas. There are a pool of people we can reskill and areas to turn into technology hubs. To attract companies to train people in these areas, there will be an inherent cost of setup and logistics to distribute their workforce further. This is a great idea, but it would be great to see some financial incentives that help companies set up their regional hubs.”

“We also need digital technology to speed up the Visa process to increase immigration. We should invest in intelligent automation such as Robot Process Automation to halve the time of this process and spend money on the technology rather than just on people to process the visas. We should also consider a new class of visa for urgent tech skills.”

Tristan hopes the Budget will also focus on incentivising people back to work, particularly as The Great Resignation saw a million Australians quit their job – nearly 10 per cent of the workforce. 

“We lag behind most countries in employees returning to work. This is going to have long-term issues for businesses. For example, we are seeing a major increase in cyber-attacks on companies, and with so many people still working from home, it will make it easier for cyber-attacks to happen. 

“We will also struggle to train new skills without people working together in person. We need incentives or standards across industries to get people back to work. It would be great for Government to subsidise the return to work to make it easier on people, for instance, by making transport tax deductible. Getting people back into the office is critical for our tech future.”

On digital innovation and Australia’s evolution into a digital economy, Tristan says:  “Australia needs some serious investment to become a top 10 digital economy, as we are well behind the rest of the world at the moment. Corporate Australia is well ahead of our government. Perhaps we need to learn from corporate Australia how they managed to move much quicker than our government and start attracting Australian businesses that are starting to work offshore to focus on Australia instead.

“We have some amazing local businesses who can help accelerate this move, but for top companies, Australia is not as attractive as selling their services overseas, especially with a rising US dollar and a bigger international demand for these services. This will slow us down unless we can attract local companies to invest more in Australia. This could be in the form of a one-off tech bonus to these companies, particularly the mid-sized ones who have proven ability and will continue to grow, such as those with 200-plus people.”

A cybersecurity perspective 

You may have recently heard a lot about the need to close the cybersecurity workforce skills gap and how doing so will help to address the issues caused by the increase in cyber events, assaults, and breaches. According to Jacqueline Jayne, Security Awareness Advocate at KnowBe4, the upcoming Labor 2022-23 Budget is unlikely to include anything marginally beneficial or meaningful in protecting Australians’ online safety.

“The rhetoric has been a predictable year on year with ‘uplifting our cyber posture and ‘building capability across national priority sectors’ plus ‘improving safety, security and trust’. Please note that there is nothing wrong with that.  It’s what’s missing that is a concern.  

“The 2020 Cyber Security Strategy was delivered without the necessary measurable deliverables and outcomes linked to the human element of cybersecurity, and the budgets have followed suit.   

“Considering the overwhelming evidence that the majority of successful cyber-attacks/breaches result from human error, it stands to reason and logic that education and awareness of humans should be non-negotiable. Think about this for a moment. Now, and for many years, anywhere from 8 to 9/10 of successful cyber-attacks/breaches are the result of human error. That’s a lot. 

“We have a baseline to work with already, and if done correctly, the Australian Government can move the needle.  Even a small drop would be incredible when you consider the cost of reported cybercrime to Australians was $33 billion from 1 July 2020 to 30 June 2021.

“Let me say this first – yes, we need more people in the cybersecurity workforce.  However, the recent Optus data breach has highlighted that we have a greater risk at hand.  The cyber knowledge or awareness gap exists within the general population, consisting of every human who uses technology and devices and works outside the cybersecurity bubble. 

“In the days that followed the Optus breach, our government issues new legislation, laws and commentary towards organisations regarding cyber incidents. The media focused on who should have done what, when and why and who was to blame. 

“A basic level of cyber hygiene includes the use of a password manager, implementation of Multifactor Authentication (MFA) using a third-party authenticator app, and knowledge and awareness of their data – specifically the different type of data they have shared with organisations and when they need to take action should it be involved with a data breach. 

“Empowering Australians to make better security decisions is the goal which comes from a focus on security awareness, behaviour, and culture.  This is a direct result of an ongoing, relevant, and engaging security awareness and education program incorporating organisation-wide cooperation.  We can not rely only on government or technology when the majority of breaches directly result from human error. 

“Cybersecurity is everyone’s responsibility, and we are far from being in a position where we are making better decisions regarding staying safe online. My rose-coloured glasses remain on as 2022/23 Labour Budget is in its final stages before release. 

Seeking support for the workforce shortfall

While Adeline Fernandez, Finance Director of Fluent Commerce, welcomes the increase in permanent migration visas, her biggest concern, like many other fast-growing Australian businesses, is the IT talent shortage.

“Talent shortages in IT have always been a problem, but this has worsened recently, particularly due to the lack of skilled migrants due to border closures. In a recent survey we commissioned with Incisiv, the tech talent shortage is also the biggest concern for our customers and retailers, who said it impeded their ability to manage their fulfilment operations effectively.

“Extending paid parental leave from 18 weeks to 26 weeks will encourage more women back into the workforce and help families share the responsibility for caring for children. The pandemic has disproportionately affected women, and the cost of childcare continues to be a barrier to workforce participation, so this is going to make a huge difference to families and provide a boost to the economy. 

“I would have liked to have seen the government take a step further and support initiatives to get the long-term unemployed back to work, perhaps those who have taken a career break to raise children or have left the workforce to take up caring duties.  This is truly an untapped pool of talent we have at our doorstep.  Some companies are already ahead by providing training programs for those re-entering the workforce.  The government should look into how they can further support these programs similarly to how they support apprenticeships.  

“The government should also consider removing the exemption to pay super on parental leave so that all companies do it. It’s a small cost for companies, but it would help ensure women remain financially secure in retirement. At Fluent Commerce, we’re addressing this by paying super contributions on paid parental leave, even though it’s not a requirement.” 

Meanwhile, Kath Greenhough, APAC VP, Skillsoft, says that the Australian government increasing the skilled migrant cap will help, but the labour market for technical professionals is facing another pressing challenge centred around talent attrition. 

“Skillsoft’s 2022 IT Skills and Salary Report shows that 53% of IT professionals are extremely or somewhat likely to look for a new job in the next 12 months.

“Over the past year, the workplace has been defined by employee-led “movements,” namely the Great Resignation and “quiet quitting.” Meanwhile, the pace of digital transformation and lack of enough technical resources have pushed many IT professionals to the point of burnout. Together, these trends are fuelling record rates of talent turnover across all industries.

“While the obvious answer for companies facing these challenges might be to recruit their way out of it, this is not always easy. It costs companies heavily to address their skill gaps through new hires, and they’ll need to rely on learning and development programs to cultivate the skills they — and their workforces — need. In some ways, this is good news, as retaining existing talent is typically more cost-effective than hiring new employees.

“Our most successful customers generally are all placing greater reliance on upskilling and reskilling programs to address their growing skill gaps.  They are building cultures of learning, which not only help future-proof their workforces but also have a demonstrable positive impact on employee satisfaction and retention. Deliberate planning focused on creating transformative learning experiences will not only solve today’s skills gaps but also create a sustainable workforce aligned to future skill needs.”

The lack of skilled workers in the technology sector is a significant problem for firms all around Australia, according to Michael Bodle, COO of Mantel Group.

“With unemployment at a 50-year low, we have an opportunity as a nation to double or even triple our skilled migration program. We would encourage the Government to seriously consider a step change in the skilled migration program to provide innovative ways to attract global talent. 

“For Australian businesses to compete globally, the government must commit to making skilled immigration straightforward and processing visas quickly. It also needs to invest in the infrastructure and business support that will position Australia as an attractive prospect for global innovation. The competition for tech talent is global – what will make skilled people come to Australia rather than the U.S or Europe? It would be great to see the Budget helping to not only attract skilled people to come and live in Australia but keep them here over the long term.

“The other significant challenge facing Australian businesses is rising cash rates. We’re looking for the Government to support high-growth industries and help companies mitigate the impact of the cost of capital and inflationary forces. This stimulus shouldn’t be broad-based to work against current monetary policy.”

The Treasurer will deliver the 2022-23 October Budget at approximately 7:30 pm (AEDT) on Tuesday, 25 October 2022, here.

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* This article was originally published here