FCA calls for national action on staffing: latest survey reveals rising concerns

franchise staff shortages
Lack of suitable employees is troubling the franchise sector. Image Bigstock.

The Franchise Council of Australia (FCA) is calling for national action on staff shortages following the latest industry survey.

The September Quarter 2022 Franchise Business ‘Pulse Check’ showed ongoing staff shortages are now at a record high.

Employment is the greatest challenge for small businesses. Eighty three per cent of those surveyed cited the availability of suitable employees for franchisees as the major worry.

This percentage has continued to rise this year; it was 80 per cent in the previous survey, and 64 per cent in March.

FCA calls for action

The Franchise Council of Australia CEO, Mary Aldred, said “The situation for small businesses across Australia in regards to staff shortages is worsening. We need urgent action at the national level to address this challenge.”

Aldred said the drop in immigration needs to be addressed.

“It is not enough for the Australian border to be open, specific actions to increase the domestic participation rate and the attractiveness of Australia as a destination for international labour are needed”, she said.

“We want to work alongside government on practical solutions. Potential measures that have been raised by our members include diverting more resources to address the visa backlog, which stands at 880,000 applications.”

Franchise staff shortages a bigger concern than supply chain and economic pressures

The second biggest concern of survey respondents was the availability of suitable employees for support offices (55%).

Supply chain issues (45%) and rising interest rates and the inflationary pressures (39%) rounded out the top four challenges.

Optimism dominant in franchise sector

Small business sentiment is improving, however, with 67 per cent optimistic about the next six months despite the ongoing challenges. In the survey, only 19 per cent of franchisors were neutral, and only 14 per cent pessimistic. In July just 57 per cent of respondents were positive about the immediate future.

Year-on-year quarterly trading continues to recover. Nearly half of small businesses (47%) reported at least a 10 per cent increase in their September 2022 quarter income compared to the previous year.

Just over one third of those surveyed (33%) marked Queensland as the best performing region over the last 12 months. In July the corresponding figure was 46 per cent.

Almost a quarter of respondents (24%) listed New South Wales as a high performer. Next was Western Australia (21%), then Victoria (17%) and South Australia (5%).

Looking 12 months ahead, however, 37 per cent of small businesses nominated Victoria as the most likely location for expansion. New South Wales closely followed at 36 per cent. Queensland is a target for 22 per cent and Western Australia at 5 per cent.

FRANdata prepared the ‘Pulse Check’ survey for the FCA. The survey received responses from 105 brands, capturing 18,482 businesses who employ 202,223 people.