QUOTE(Garysydney @ Aug 21 2020, 10:56 AM)
In Aust, everything is highly regulated by authorities and this makes it very hard for businesses to survive. There is too much red tape which is why you see a lot of manufacturing businesses head overseas (labour costs are way too high). Look at the small restaurants having to pay A$20/hr for waitresses - it is just not viable to take the risk of starting a new venture and then having to pay such high labour costs. Look at Din Tai Fung restaurant yesterday underpaying their staff - they were fined a total of A$600k? for underpayment of staff wages. If the trend continues, diners will have to foot the high wages and restaurant dishes prices will increase. Nowadays you can see a lot of restaurants closing down in SYdney due to the pandemic and with such high unemployment rates in Aust, you still see unions insisting on pay rises for their employees!! The unions must be out of their mind!! Instead of lowering wages to stimulate demand, unions are still making demands for pay rises! You will see a lot more businesses collapse over the next 12-24 mths.
Luckily this lucky country produces a lot of iron ore and coal but this natural resources may run out one day - in that event the lucky country's luck may just run out.
i think with imposing minimum working rate, I suppose it will be good for career, but not for enhancing business climate. Bosses of restaurant may not be able to generate enough cash to correct their business model when something went wrong or expand because of expensive wages. So they have to attend to be waiter themselve very often at start. This makes expansion very slow unless they have alot of cash to burn. then when all the cost put into the selling price, end up no one would buy, and the more the insist on minimum wages, the more pressure the selling price will be. Just take one hiccup like this for example, how many business will fall.
1:08 speaks everything
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my parent's F&B business in KL had salary cut for staffs after coming into a meeting and all the staff agreed to do so. Therefore few chains managed to survive through this pandemic. It is lucky enough that most of them do not have a lot of commitment, or i can say no high commitment, for example cheaper room rents, food and etc. What i am trying to say is, imagine the commitments are high, the staffs will suffer and possible they will end up complaining to Labor office, then union will form. lol
it is very true, when you say lowering wages to help and stimulate demand, but I cannot see how it will going to work if the unions want this and that lol.