Solar tech firm, 5B, is another Australian business where job losses have recently occurred. The company was forced to cut 25 per cent of its staff in June, to keep its spiralling costs down.
Chris McGrath, 5B’s co-founder and CEO, said it was a “very difficult decision” to make, but maintained the job cuts were necessary to keep the business on “a more sustainable footing”.
Around that time, 5B raised $30 million from investors, which will instead be used to improve its product and supply chain. Its main innovation is a metallic device (an “array”), used to install solar panels on rooftops more quickly.
Some of its high-profile investors include former prime minister Malcolm Turnbull, wealthy businessman Simon Holmes à Court (who helped fund the teal Independents at the May federal election), and US electricity company AES.
Since 2020, Mr McGrath’s workforce grew rapidly from 30 to over 200 employees (before a quarter of those jobs were culled).
The past couple of years was a golden opportunity for businesses to borrow money at very low rates to fund their expansion, as governments pumped trillions of dollars worth of stimulus into their pandemic-ravaged economies.
But the flow of cheap money is now being turned off.
Governments and central banks are removing their emergency stimulus to contain an inflation blowout, as supply chain blockages and a shortage of goods (worsened by the war in Ukraine), has led to both businesses and consumers experiencing their biggest price rises in decades.