Australian small businesses face record cost pressures

A new Small Business Cost Pressure Index released by AMP Bank Go shows that Australia’s 2.7 million small businesses have seen key costs rise by 24.6 % from March 2020 to March 2026, with a projected total increase of 27.1 % by year‑end. Insurance expenses have jumped 51.7 %, interest payments 36.3 % and wages 20.3 % over the same period. AMP Bank Go director John Arnott said the index is intended to “cast a light on how their small businesses are doing it tough.”

Bricklayer Tara Amuso, who runs a central‑Victoria business with her husband Damian, described the year as the toughest since the company started six years ago, noting that recent changes to employment law have turned many subcontractors into employees, raising labour costs from $50 to about $70 per hour. The pressure has forced owners to absorb higher costs through lower margins, longer hours, delayed investment and reduced personal withdrawals. The number of micro‑businesses (1‑4 employees) fell by 38,587 since 2021/22, leaving 688,870 such firms.

The findings highlight the strain on small‑business owners across Australia as they grapple with soaring operating expenses while trying to maintain profitability and service their communities.