Inflation is hitting tradies hard, and many sole traders are also battling the aftermath of disasters, accountancy firm Hnry says. Photo / Nitat Termmee, Getty Images
Inflation is hitting tradies hard, and many sole traders are also battling the aftermath of disasters, accountancy firm Hnry says. Photo / Nitat Termmee, Getty Images
Many sole traders and especially tradies are seriously struggling due to inflation and major disasters, an accountancy firm says.
But most sole traders do not want to raise their rates to offset the impacts of inflation, according to Hnry, an accountancy service for sole traders.
Hnry said nearly 40 per cent of businesspeople it surveyed recently reported impacts from both Cyclone Gabrielle and the January Auckland floods.
Among those picking up the pieces is event planner Karrie-Ann Tuck.
She said many challenges currently existed but at least sole traders had more power to navigate the current conditions.
Tuck said she had the flexibility to dial her workload up or down if needed, and to work in the most efficient way for her own needs.
But she said recognition of sole traders was overdue, as was support.
“If those self-employed people who are feeling the pinch and running on empty aren’t getting the best support available, specifically for them, they’re not alleviating those financial pressures as much as they could be.”
Hnry said New Zealand had more than 400,000 sole traders, comprising almost 20 per cent of the country’s workforce.
“Tradies have been impacted the most, with 97 per cent reporting paying more for supplies and services, and 86 per cent saying that high fuel prices have impacted their business,” the company’s Sole Trader Pulse survey said.
“Sole traders also appear less willing to raise their rates to offset the impacts of inflation, with only 28 per cent of sole traders reporting that they’d raised their rates in the last few months.”
Hnry said that compared to 56 per cent last June, when inflationary pressures were emerging.
Some 44 per cent of sole traders in the survey said the current health of the economy was poor or very poor.
And only 13 per cent expected the economy to be healthy or very healthy in six months’ time.
“The financial situation and mental health for many sole traders is dire. 43 per cent said they would struggle to cope if they had a major, unexpected business expense,” the Sole Trader Pulse added.
Hnry said the most pessimistic group were health and wellness professionals.
The health sector has been facing multiple challenges this year, with one health sector leader telling the Herald major concerns existed around labour supply, funding, and patients unable to access general practices.
Inflation and the lingering impacts of the Covid-19 pandemic were also contributing to the challenges, Hnry said.
The majority of respondents - 74 per cent - said they’d been compelled to dig into savings, or save less.
Karan Anand, Hnry chief strategy officer, says claiming all the right business expenses can make a big difference if disaster strikes. Photo / Supplied
Hnry said sole traders worked across all industries, from trades to health, the creative sector, and beyond.
The company said the Sole Trader Pulse found less than half of traders claimed all the business expenses they’re entitled to, missing out on up to $5,611 in expenses per year.
Karan Anand, Hnry chief strategy officer, said sole traders had an advantage in that they could take initiative to improve their own working situation.
“It’s fantastic to see Kiwi resilience coming through with Hnry’s sole traders, who want to ride out the challenging times we’re navigating so they can keep doing what they’re passionate about.”
He said simple things such as claiming all the right business expenses could provide a buffer to help tackle unexpected expenses.
