Like so many sole traders, Emily Turnbull has been relying on the JobKeeper wage subsidy to survive.
- Sole traders fear changes to JobKeeper due at the end of September
- They say it’s too soon and the reduced amount “is not going to be enough to live”
- One economist predicts JobKeeper recipients will move into paid work
“It’s basically my only source of income at the moment,” she said.
The 28-year-old and her partner run Magical Princess Entertainment in Melbourne, which hires out actors to play princesses at children’s birthdays and other events.
In December, they were booked for up to 30 parties each weekend.
“So our company was really, really booming last year and for us to go basically to nothing is really difficult,” Ms Turnbull said.
Lockdowns in Melbourne and social distancing rules saw the business shut down in March.
“The first thing that a child wants to do is run up and hug you. That’s because they really believe that you are the real princess.”
For Ms Turnbull, the decrease in the JobKeeper payment later this month is another blow.
“I don’t know what we’re going to do. It’s not going to be enough to live,” she said.
“It’s not enough to pay bills and pay rent and afford food.”
The changes to JobKeeper that passed the Parliament this week will see the fortnightly payment for full-time employees decrease from $1,500 to $1,200 on September 28.
On January 4, it will drop again, to $1,000 a fortnight until March 28.
Ms Turnbull said for small businesses like hers, the drop in support would be crushing.
“They need to keep it at the same rate because not everyone is going to be able to return to work in the next couple of months,” she said.
More than 1m people come off JobKeeper this year
According to the Federal Government’s most recent budget update, more than 3.5 million people are currently receiving JobKeeper.
The Department of the Treasury expects 2.24 million people will still be receiving the payment in December, meaning 1.25 million people will likely lose the subsidy before the end of the year.
“On the whole, we’d expect most people who have moved off JobKeeper to be moving back into paid employment,” Grattan Institute economist Brendan Coates said.
“We’ve seen a recovery in employment in most states.
“It’s stalled, obviously in Victoria and to a lesser degree in New South Wales, but there’s been strong jobs growth in the other states.”
While there are hopes those coming off JobKeeper will find paid work, some business leaders fear the change is happening too soon.
“I think it is too premature for the Government to reduce those rates,” chief of the Small Business Association of Australia Anne Nalder said.
“Taking this amount of money [out of the economy] — I don’t think is a very wise decision at this point. It’s too early,” she said.
Both JobKeeper, JobSeeker available for some workers
The reduction of the JobKeeper rate for full-time employees is not the only upcoming change.
From October, there will be a second tier of JobKeeper payment for part-time employees, which will see them paid $750 a fortnight.
Recipients in that category may also be able to claim a part-payment on the JobSeeker unemployment benefit.
Because of that change, the Department of the Treasury does not know for sure how many more people will join JobSeeker.
The Government had previously forecast at least 345,000 more people would sign up for the unemployment benefit by the end of the year.
Ms Nalder said she believed the JobKeeper rate should not change until March 2021.
“By then we will have a very clear picture … as to where we are heading,” she said.
On the Gold Coast, small business owner Roger Davy could not agree more.
“I really believe that JobKeeper should stay at the full rate, until at least March next year,” he said.
Mr Davy is a singer who runs a corporate entertainment business, Vavachi Entertainment. He has not performed since mid-March.
“JobKeeper has been an absolute lifeline for my business,” he said.
He said lowering the rate after September will make it a struggle to meet ongoing costs, such as public liability insurance and website upgrades.
“It’s going to create even more stress,” he said.
Mr Davy said he believed the Government should establish different guidelines for specific industries.
He believes the entertainment industry, which has been hit especially hard by social distancing rules, has been left behind.
“Once the end of September comes along and they reduce the JobKeeper payment as well as everything else, there are a lot of businesses that won’t come back,” Mr Davy said.
Ms Turnbull is determined her business will survive, and princesses will once again be visiting kids all over Melbourne, but the question is when.
“I don’t even think we’ll be able to operate this year at all. Maybe next year if we’re lucky,” she said.
She hopes the lower JobKeeper payment will be enough to keep her afloat.
“I don’t know where the future lies … I don’t know where it’s going,” Ms Turnbull said.
“I just want to get back to doing what I love.”