The sad reason why Australia is no longer the clever country – as our home-grown genius is hung out to dry
Australia will be less likely to invent things as small business innovators struggle to get a bank loan, a Reserve Bank official says.
WiFi technology, the ute, Victa lawn mowers and the Hills Hoist washing line are among Australia’s best-known inventions over the past 90 years.
Smaller companies would now be more likely than large companies to come up with great ideas if they focused on innovation, Assistant RBA Governor Brad Jones said.
“The intensity of innovation is much higher for the small and medium-sized enterprises (SMEs) that innovate,” he told a Council of Small Business Organizations summit on Thursday.
‘In short, these SMEs are more likely to throw the kitchen sink at innovation.’
But Dr. Jones said small businesses were less likely to get a bank loan, even though surveys showed more than half of them were trying innovative ideas.
Australia will be less likely to invent as small business innovators struggle to get a bank loan, says a Reserve Bank official (pictured is a 1950s image of the Victa lawn mower)
WiFi connections, the ute, Victa lawn mowers and the Hills Hoist washing line are among Australia’s best-known inventions over the past 90 years (pictured is a 1934 Ford ‘coupe utility’ with designer ‘Lewis’ Bandt)
“The top issue is that small businesses are riskier propositions for capital providers,” he said.
Banks like banks were nervous about lending to small businesses because they were more likely to go into receivership within a year of starting.
“The survival rates bear this out: Whether new or established, small businesses are more likely to fail in a given year than their larger counterparts,” he said.
‘Particularly low survival rates among young small businesses correspond to the ‘up or out’ phase of their development, where they experiment and succeed, or fail and quit – they crash or crash.’
Brad Jones, assistant governor at the Reserve Bank, noted that small and medium-sized enterprises (SMEs) are now more likely than large companies to come up with great ideas if they focus on being innovative.
A further 413 companies went bankrupt in February, a 74 per cent increase from January, Australian Securities and Investments Commission insolvency data shows.
A further 413 companies went bankrupt in February, according to Australian Securities and Investments Commission insolvency data released this week.
The monthly figure of 968 was 74.4 percent higher than January’s 555 level.
Australia has also been in a per capita recession since the middle of last year, which has reduced economic growth per labor.
In recent years, productivity levels in Australia have also slowed; last year, production per employee fell by 0.4 percent.