Workforce Shortages + Financial Strain = A Perfect Storm

The State of the Disability Sector Report: A troubling outlook

The recently released State of the Disability Sector Reports paints a challenging but not unsurprising picture for the industry.

With nearly half of providers reporting a financial loss in 2024-2025 and others only a small surplus or break even it's no wonder providers are finding tough margins totally unsustainable.

Figure 14, below from the report highlights a concerning trend. In nearly 10 years, profitability briefly spiked during Covid and has been on a steady downward trajectory ever since settling on only around 35%, with losses actually also increasing since around the same time. Fewer than 20% of providers are breaking even or close to breaking even!

Looking ahead, it seems that the industry is predicting even worse returns going forward with just less than 40% of providers expecting to make a loss and just over 30% expecting to break even or close to break even. The proportion of providers expecting to make a profit has plummeted from a peak of 60% in 2020 to now approx. 25% down nearly 10% from actual current numbers.

What we're hearing on the ground

Providers are stretched to their limits. Many are working evenings and weekends to complete essential tasks such as payroll, invoicing and general admin tasks - not to mention the time and costs spent preparing for audits and maintaining compliance. With so much pressure, few have the capacity to think about and plan for grow and scale, even though they know it is essential for survival and driven by their deep desire and commitment to helping people.

The demand for services is strong, but the current operating model just isn't profitable or sustainable. With burnout on the rise the next challenge is also clear: finding and retaining staff.

Delivering high-quality, person centred and outcome-orientated services are non negotiable for maintaining quality standards for clients. Yet time and resources are often the biggest barriers to achieving this ideal. So the question becomes:

How do you run a business without compromising care and quality whilst still being sustainable and profitable?

The answer lies in Innovation

To thrive in this environment, providers must embrace different ways of working, doing things differently and getting a different, better result.

Einstein once said

When is the right time to innovate and change?

Quite simply when the current model isn't working. when, what you are doing is giving you unsatisfactory results.

The State of the Disability Sector Report are transparent - providers aren't making enough profit nor will for the foreseeable future and without something changing the future looks bleak. If providers aren't sustainable, they cannot continue providing quality care. And the consequences will be dire for thousands of participants who risk losing access to continuity of care or worse, care in general.

As a provider you can't change the fixed NDIS pricing but you can regain control of your business and change your expenses and overheads. Offshoring offers a practical, strategic way to regaining control of your business. By leveraging offshore talent for back- office/corporate services (such as Finance - payroll, billings, HR - recruitment, scheduling, IT, Marketing etc) you can:

• Reduce operational costs significantly

• Free up local teams to focus on client facing care

• Maintain quality standards while building a sustainable model

And most importantly focus on growing your business, by being less operational in the business.

Contact us on hello@universal-u.com or 1300 794 249