Independent traders lose $3.2 billion a year in productivity as economic outlook toughens

0

Self-employed New Zealanders lose an estimated two million hours a week – about $3.2 billion a year – in productivity, due to the burden of tax and financial administration, while 75% believe the 2022 budget would have no or negative effect on Their business,

according to the latest results of the independent Sole Trader Pulse survey.

Independent traders are a significant part of New Zealand’s economy, accounting for almost 20% of the workforce. The independent survey, commissioned by Hnry, also finds many have a pessimistic view of the health of the economy, with just over 40% saying conditions will be bad, or very bad, six months from now.

James Fuller, CEO and co-founder of Hnry, New Zealand’s largest accountancy firm, says that despite the increase in profits over the last quarter, many self-employed workers are tightening their belts.

“We are in a perfect storm of inflation, rising interest rates, fuel costs, supply chain issues and economic uncertainty – although more than half of respondents report higher incomes. higher than the previous quarter, we see more and more people preparing to pull back in the second half of the year,” he says.

“A deeper understanding of the unique needs of independent traders by government is still obviously needed. Only three percent of respondents believe the latest budget will actually benefit their business, while no traders surveyed believe it will benefit their business.”

Independent traders are also facing the credit crunch. Less than half of respondents had tried to take out a loan or credit in the past six months, and less than one in ten had considered non-government sources of credit – such as banks or finance companies.

“Stricter lending criteria are impacting the ability of sole traders to obtain credit to grow their business or finance assets like work vehicles. Only 39% of sole traders attempted to obtain alternative financing in the first half of 2022 – of those who succeeded, nearly two-thirds focused on government grants and subsidies. Less than one in ten have consulted non-government credit sources,” says Fuller.

James Fuller has met regularly with the Honorable Stuart Nash, Minister for Small Business, to champion independent traders and highlight the specific needs of the sector so that it is better equipped to thrive in difficult economic conditions. A pressing concern is how the industry can recoup the two million hours lost every week in ‘non-billable time’; and the role that digital tools and services can play in achieving this. Traders spent the most time on administration, twice the weekly average, while independent traders using modern online accounting services spent less than half the weekly average.

The Sole Trader Pulse surveys a large sample of 500 freelancers, including freelancers, entrepreneurs, consultants, merchants and gig economy workers. It is New Zealand’s first independent and nationally representative sentiment index for independent traders, providing valuable insight into the growing sector which is recognized at government level. It has a margin of error of +/-4.4%.

About Henry:

Hnry provides an all-in-one digital accounting service for entrepreneurs, freelancers, independent traders and freelancers, allowing them to focus on getting the job done and never have to think about tax and tax again. to compliance. Australasia’s fastest growing accounting firm, Hnry, handles tax and returns, invoicing, expenses and payments in an affordable pay-as-you-go model and provides expert assistance to the request.

Founded in Wellington in 2017, Hnry has seen record growth and now helps freelancers in New Zealand and Australia. Hnry has continued to win awards and accolades including ‘Emerging Service of the Year’ at the 2019 Wellington Gold Awards, was named a finalist for ‘High Tech Service of the Year: at the 2019 NZ Hi-Tech Awards, winning ‘Supporting Gold’ at the Wellington Gold Awards 2020 and People’s Choice (FinTech Organization of the Year) Award at the Australian Finnies 2022. The company is currently a finalist for ‘Hi-Tech Service of the Year’ at the NZ Hi-Tech Awards 2022.

© Scoop Media

Share.

Comments are closed.