As we emerge from the COVID-19 pandemic, our economy faces a long road to recovery. The unemployment rate has reached an all-time high of 34.4%, with the economy only set to recover to pre-pandemic levels by 2025.
The outlook is bleak, but we have an opportunity to significantly improve it if we better support the engine of our economy – small businesses. They employ nearly 80% of the workforce and will be the ones creating jobs and opportunities in the future.
That’s why we are launching our Time to Rebuild: Accelerating small business growth in SA manifesto today and calling for greater government support for SMBs. It sets out Xero’s nine recommendations for the government and business community to support small firms and unlock economic growth.
I believe South Africa has the potential to turn the tide and revolutionise the world of small business through digitisation, innovation, expanding the tax payer base and creating fairer trading conditions.
But it won’t happen on its own. We need greater action from the government and stronger collaboration amongst the wider business community to force change.
Xero’s nine recommendations
Over two thirds (68%) of small business owners told us they see economic instability as their biggest challenge. Which is why it’s so important that we create an environment where businesses can actually grow.
The nine key areas we truly believe can improve the prospects of small business owners are highlighted in our manifesto. These include; tech adoption, skills development, greater collaboration, simplifying tax compliance, innovation and the role of accountants.
One of the most critical areas is digital adoption. We’ve already seen the transformational role of tech during the pandemic – it’s been the difference between survival and closure for many SMBs.
With 41% of businesses feeling they are only just keeping up with it. Xero is asking the government to increase support as business owners adopt new digital tools, including a campaign to create better awareness and break down the barriers to access through tax relief.
Building a more collaborative SMB community
At the moment there isn’t enough collaboration happening between key stakeholders. Technology can help join the dots between SMBs, their accountants, banks, government, Funders and technology companies – the key enablers of the small business community.
We all need to think about how we can positively contribute to the nine recommendations in this report and continue pushing for change at government level. Only with greater collaboration can we start to drive progress and accelerate growth in our economy.
This will mean being more open to working together in new, innovative ways that have clearly defined objectives and promote greater accountability. We need to see action, not just conversation.
We have to keep this momentum up. We will be campaigning for our customers and the entire small business community in the months ahead. You can read the full report here.