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Some sensible facts in the ‘gig’ economy/small business debate

Sunday, March 24, 2019

We recently discussed the re-emerging campaign against self-employment being cooked up principally by unions and the Labor ‘left’. We’ve seen this over many decades and this time the ‘evil’ is the gig economy.

  • And we’re witnessing the Victorian government conducting what we see as a cooked-up Inquiry. Frankly, we think they’ve written the conclusion before starting the Inquiry. In our detailed submission we’ve said that the discussion paper is littered with misinformation, plainly wrong on basic facts and implies a forbidding imaginary scenario. Yes, we have our bias (a big bias) in favour of self-employment.
But it’s really good to see some sensible, independent, factual analysis injected into the debate. Bernard Salt is one of Australia’s top demographers. He talks facts. In his most recent article in The Australian he supplies some illuminating information.

Sole trader numbers surged, he says, by 65,000 last financial year. And
  • “Further analysis revealed that many of these new businesses are connected to the gig economy…”
However, this article focuses on small businesses employing 1-19 workers. He says
  • There are “823,000 such businesses in Australia employing, by my estimates, six million workers or close to half the nation’s workforce.”
  • “Over the preceding decade … small business … expanded by 80,000 supporting about half a million jobs.”
But it’s the diversity that’s interesting. He says
  • “Non-standardised product or service delivery is where small employing businesses are expanding, delivering bespoke housing solutions and one-on-one medical advice.”
He points out where this is happening and where it needs to happen.
  • “There is evidence of a rising pool of small employing businesses—a kind of start-up culture if you like—emanating from the Sydney, Melbourne and even the Adelaide CBDs. But this is not the narrative in Perth or Hobart or Canberra or Darwin.”
  • “But if we are to cultivate a culture of entrepreneurship then we need stronger small-business hubs delivering measurable net new employing businesses in the smaller states and territories.”
Bernard urges politicians to get the policy settings right because it’s here where the big growth in jobs will come from.

We agree. That’s why over the decades we’ve fought for reforms to work safety laws, the Independent Contractors Act, small business unfair contract laws, Small Business Commissioners and more. These are the sort of policy settings that support small business and the creation of jobs. The anti-gig economy campaign is dangerously irrational in its non-factual attack against business systems that create small business opportunity.

But, on a big upside: We’re becoming quietly hopeful that we’re about to see a big advance from the ATO in its processes for dealing with self-employed small business people. We’ll keep you informed.

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