The new decade has started with out-of-control bushfires destroying lives, homes and towns in minutes, followed by flash floods, a deadly virus…it’s a lot to process in a few short weeks but there’s another disaster unfolding in the Australian retail sector.
The latest Australian Bureau of Statistics data shows that retail trade fell 0.3 per cent in January on a seasonally adjusted basis, extending its fall from the previous month. In other words, less people are spending and it’s starting to hurt many retailers.
On the 3rd February handbag and jewellery powerhouse Collette by Collette Hayman entered into voluntary administration and it joined a long list of retailers who have found themselves in the same position over the past 12 months.
Since January 2019 Jeanswest, Curious Planet (formerly known as Australian Geographic), Bardot, McWilliams Wines, EB Games and Harris Scarfe are just some of the brands to announce the mass closure of stores or the entry into administration.
Retailers banking on strong sales over the Christmas period were left disappointed and it’s no doubt that the natural disasters facing the country have curbed consumer spending…unless of course you count the latest surge among people buying toliet paper in fear for the Coronavirus!
Retailers are now not only competing with one another, they’re competing with large department stores that purchase in bulk for insane discounts (think Kmart), the rise of online shopping and a new trend….ethical and intentional spend.
Reduction of household and consumer debt is on trend thanks to books like Scott Pape’s, The Barefoot Investor and Dave Ramsey we are seeing a generation spending more consciously.
Struggling with debt to keep up appearances is starting to lose it’s appeal and we are seeing people more focused on their financial stability rather than their status symbols.
Living within your means is now cool (which we think is awesome!)
We are also seeing environmental and humanitarian reasoning behind spending curbs. The Ethical Fashion Guide which ranks retailers based on their treatment and conditions of their workers along with their environmental impact is gaining a lot of traction and attention especially with younger consumers. Fast Fashion is out and conscious spending is in!
When you combine all of these factors it’s not hard to see why our retailers are struggling.
The closure of any business or any store in Australia is sad, what is most concerning to me though is the employees left without a job following that decision.
According to the last census data around 75% of retail workers are female. When these stores close, it is these women who are left without a job. We already have a national issue with lower wages for women, lower superannuation amounts, a huge gap in unpaid work and now sectors that comprise predominately of female employees are laying staff off with little to no warning.
So what can we do about this? Firstly, I don’t think a move toward increasing consumer debt is the solution.
The trend toward more conscious, intentional spending and living within our means is a trend that the Financy team well and truly welcomes…where our concern lies is with the female employees who are the ultimate victims.
Understanding your rights as a female employee is first and foremost the best way to protect yourself.
When a company enters into administration your employee entitlements remain, this means any unpaid wages, accrued annual or long service leave, superannuation and pay in lieu of notice are owed to you. Typically though, when a company is shutting up shop it’s because they don’t have any money.
This is where the governments Fair Entitlements Guarantee comes into play. The Australian Government provides financial assistance to cover certain unpaid employment entitlements to eligible employees who lose their job due to the liquidation or bankruptcy of their employer. For more information on the Fair Entitlements Guarantee head here: https://www.ag.gov.au/industrial-relations/fair-entitlements-guarantee/Pages/default.aspx
As women it is vital we remain educated on our rights and entitlements when it comes to all things money. Remember, no one is looking out for your best financial interests except you!