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Small business and contractors under pressure.

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CRAIG EMERSON Member for Rankin

Shadow Minister for the Service Economy, Small Business And Independent Contractors

26 February 2007


Today’s release by the ABS* on the number of Australian businesses reveals that independent contractors are struggling under the Howard government’s policies.

The survival rate of new non-employing business established in 2003-04 was two thirds to June 2005, falling to less than half by June 2006.

That is, only half of contractors survived beyond two years.

The Howard government has repeatedly claimed to look after independent contractors but these survival rates tell an inconvenient truth that contractors are going out of business at an alarming rate.

The growth in the number of businesses has slowed recently, indicating a tougher economic environment for new small businesses in particular.

The number of businesses grew by 2.2 per cent during 2003-04, by 1.5 per cent in 2004-05, and 1.3 per cent in 2005-06. This compares with GDP growth of 4.1 per cent, 2.7 per cent, and 2.8 per cent over the corresponding period.

The number of new small businesses is growing at a slower rate than the overall economy.

So much for the Howard government’s claim to be a friend of small business and independent contractors.

* Source: Australian Bureau of Statistics Counts of Australian Businesses 8165.0