Pay rise will 'help drastically' but there's nothing simple about it

Interns' Corner

Exploring the impact of the Fair Work Commission's recent minimum wage decision on one small retailer and her workers in country NSW.

In Armidale, Carissa Constable has watched the effects of Australia’s cost-of-living crisis creep into her everyday life, with much of her small pay cheque spent on the bare necessities.

As a nursing student in the small regional education hub on NSW’s Northern Tablelands, Constable is expected to juggle work, university, and a social life with the added bonus of unpaid placements, often for days at a time and in other towns. At her busiest, she was only able to take one paid shift a week.

“It was hard. There was a lot of budgeting, a lot of [asking yourself] ‘do you really need it?’ It wasn’t enough to support myself,” she said.

The Fair Work Commission’s decision this month to raise the minimum wage by 3.75 per cent to $24.10 per hour won’t solve all her financial problems, but the extra $30 a week in her pay packet will be very welcome.

That extra money, which kicks in on July 1, will come out of her boss Debbie Cartledge’s pocket. For Cartledge, the Commission wage decision represents another blow to her and many other small business owners in an already hostile operating environment

Cartledge takes enormous pride in Fika, her small fashion and gift store, which has become a mainstay in the small, but competitive Armidale retail market in the six years since she opened it . However, she said rising overhead costs are becoming difficult to deal with.

'The pay increase is good ... An extra 30 dollars a week will add up in the long run.'

“I feel like we are getting hit at every corner of the business,” she told Newsworthy. “I’ve just been sucking it up and sucking it up and I can’t suck it up anymore.”

Her views were echoed by Luke Achterstraat, chief executive of the Council of Small Business Organisations Australia. “It’s an extremely tough operating environment. The levy is really breaking for small business,” he told ABC News.

“Unfortunately, [it] will mean higher costs and more cost pressure for small businesses who are really struggling to churn out a profit and to remain in business at the moment.”

Cartledge employs a small team of young women, including Constable, mostly university students, many of whom are locals to the region and hope to remain in Armidale after their studies conclude.

Constable said current economic conditions have made things very difficult for her. “Rent isn’t cheap. Groceries aren’t cheap. Nothing is cheap now.” (For reference, groceries cost the average one-person Australian household $100 a week.)

'I understand why people want a pay rise – I get it – but it all flows on.'

“I’m two years out of school, living by myself, paying rent, going to uni … last week I did two 80-hour placements… it has been tough. If I had no family support, there’s no way I could afford to live.”

“The pay increase is good and will help drastically. An extra 30 dollars a week will add up in the long run,” she said.

The Commission said “a primary consideration [for the increase] has been the cost-of-living pressures that modern-award-reliant employees, particularly those who are low paid and live in low-income households, continue to experience.”

Middle-aged woman walking in sunshine on a shopping street in a country town.Debbie Cartledge, outside her small retail business Fika, said there is no such thing as "a simple pay rise".SUPPLIED

Cartledge, who is also feeling the strain of rising prices, said for her the cost-of-living crisis has translated to a “cost of business” crisis. “I’m never normally a penny pincher at all but I’m now starting to charge for bags, I’m trying to add money into products to cover all the bank fees,” she said.

Even prior to the Commission’s mandated wage increase, Cartledge said she had wrestled with the anxiety of staff layoffs and possible closure of the business on several occasions. “I was contemplating the future of the shop and if I remain open. I got up on Monday and knew that I had to (lay) staff off.”

She empathises strongly with her employees and is clearly distressed by having to decide between the financial integrity of the business or the job security of her workers.

“I understand why people want a pay rise – I get it – but it all flows on. It’s not just the case of it being a simple pay rise. I’m constantly training at a full wage, and that might take a week, maybe two weeks, maybe three weeks.”

Australia has just experienced its weakest quarterly growth since September 2022. The Commission’s minimum wage increase is one small part of the wider ongoing cost of living crisis.

For part-time worker Constable and small business owner Cartledge, the walls of financial stress loom high, and as those walls close in, both will face difficult decisions regarding the future of their employer and employee situations.


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