"You've actually got an artificial economy at the moment. It's not a private-public economy, it's pretty much a public-supported economy," says MYOB CEO Greg Ellis. Photo / File
"You've actually got an artificial economy at the moment. It's not a private-public economy, it's pretty much a public-supported economy," says MYOB CEO Greg Ellis. Photo / File
Accounting software company MYOB confirms up to 130 staff could go in a restructure - a development first reported by the Herald on May 15.
"MYOB employs more than 2100 people across Australia and New Zealand. Changes to our operating model will potentially impact 130 team members," aspokesman told the Herald.
The cuts are not pinned on Covid-19 but are part of ongoing changes to streamline the business since being bought by US private equity outfit KKR for A$1.6 billion in April last year. It delisted from the ASX a month later.
"We have been adjusting our ways of working for some months now and this is the next step in that process. We are working closely with affected team members to identify opportunities for redeployment internally and outplacement support where that is not possible,' the spokesman said.
Rival Xero reported a profitable FY2020 last week, but warned it had faced Covid-19 headwinds during its final quarter, and offered no guidance for FY2021.
The now privately-held MYOB no longer reveals financials, but new CEO Greg Ellis did tell Australian media that his company faced "subdued business activity".
"Frankly because of the necessary government stimulus you've actually got an artificial economy at the moment," he said. "It's not a private-public economy at the moment it's pretty much a public-supported economy".
"You've actually got an artificial economy at the moment. It's not a private-public economy, it's pretty much a public-supported economy," says MYOB CEO Greg Ellis. Photo / File
Ellis was wary of making any predictions about how the economy would fare once the giant JobKeeper scheme (the equivalent of NZ's wage-subsidy payments) is wound down over the coming months.
"Unfortunately there are no signs of any empirical evidence of the recovery being underway," he said.
"It's a crystal ball full of smoke at the moment and it really comes down to our ability to either get an effective treatment regime or a vaccine."
On this side of the Tasman, MYOB, thinks the recently extended wage subsidy scheme will not be enough to save some small-to-medium businesses.
"MYOB shares the view of many market experts that the end of the extended wage subsidy scheme will be a critical time for the economy, and particularly SMEs. The subsidy has provided essential support for many employers during the early stage of the Covid-19 crisis, made more effective by the Government's approach to delivering it simply and rapidly," the spokesman said.
"Unfortunately, given the challenging economic conditions, it is likely that without the additional support to cover wages - a key cost for small business - some organisations will need to evaluate whether they can continue to operate or not."
