Bendigo business owners have told of their relief after the government said it will extend the JobKeeper wage subsidy beyond September 27.
In changes announced by the Prime Minister on Tuesday, the JobKeeper rate will reduce by at least $150 a week in October.
The payment for people working 20 or more hours a week will be cut from $750 a week to $600 a week.
People working fewer than 20 hours will have their payment cut back to $375 a week, or $750 a fortnight.
Business owner Todd Carrington said the extension of JobKeeper provided reassurance to his staff and his business.
Mr Carrington owns Pall Mall hair and beauty salon honeyeater, which employs 11 staff.
"We had been preparing for everything to stop in September," Mr Carrington said.
"We are a small business and it's very hard to plan because we don't know what is going to happen in the future.
"Our figures are way down and we've lost four staff since the pandemic began."
Federal member for Bendigo Lisa Chesters was critical of the changes and said people relying on JobKeeper payment will earn below the minimum wage when the changes come into effect.
"Sole traders and small businesses receiving JobKeeper will struggle, particularly if their business hasn't returned to normal," Ms Chesters said.
From January, the JobKeeper payment will drop again to $500 a week for people working more than 20 hours and $325 a week for people working less.
Businesses will also have to show a reduced turnover each quarter to keep receiving the subsidy from October.
Mr Carrington said he understood the government subsidy wouldn't last forever and is grateful for its extension, with his salon losing substantial business since March.
"We shut for a month at the end of March and stood down all of our staff," he said.
"After working for nine years to build the business up, it really hit us hard.
"We reopened and JobKeeper has been fantastic.
"Fingers crossed we can keep trading and come out of this on the other side."
The JobSeeker coronavirus supplement, currently $550 a fortnight will reduce to $250 a fortnight from the end of September.
More than 5 million Australians receive JobKeeper and JobSeeker payments, including more than 15,000 people in the Bendigo electorate.
"Cutting JobSeeker will leave people looking for work and relying on a rate that leaves them vulnerable and potentially living in poverty," Ms Chesters said.
"I am concerned and disappointed in these cuts, given more than 10,000 people in the electorate are trying to survive on JobSeeker."
Senator for Victoria Sarah Henderson said the government's support will help regional Victoria get through the pandemic.
"JobKeeper has made a difference to local businesses in regional Victoria by keeping a connection between employers and employees to help them get to the other side of the crisis," Senator Henderson said.
Bendigo Tourism Board chair Finn Vedelsby said the extension of JobKeeper would reduce the financial stress of Bendigo businesses.
"Employees would be stood down if the limitations on trade were maintained but JobKeeper was not," Mr Vedelsby said.
The Victoria Tourism Industry Council said it was "thrilled" by the government's announcement.
VTIC chief executive Felicia Mariani said JobKeeper has been the lifeline every businesses has needed.
"Every operator we've engaged with over the past months has clearly noted this program is the single most critical support that's allowed them to hang on to their businesses in the midst of this crisis," Ms Mariani said.