The Roy Morgan Business Confidence study for February was headlined by increasing pessimism about prospects for the next 12 months, both for the performance of the Australian economy and the personal prospects of the business.
The decline in confidence is more pronounced in small businesses with fewer than 20 employees, with medium and large businesses above the ‘neutral level’ in confidence.
Roy Morgan CEO Michele Levine said that factors such as interest rates and inflation were among the most commonly cited causes for concern.
“The vastly different levels of confidence for businesses of a variety of sizes shows that the current economic conditions, including high inflation and rapid interest rate increases, are having a considerably different impact on businesses depending on several factors – including size,” Levine said.
“On a state level, business confidence is soaring in Western Australia at 134.2 and marginally in positive territory in Tasmania at 101.1 – but below the neutral level of 100 in all other States. Business confidence is just below neutral at 98.1 in New South Wales and well below neutral in Queensland (92.0), South Australia (90.1) and lowest of all in Victoria (81.2).”
Similar findings were reflected in the recent ANZ-Roy Morgan Consumer Confidence assessment which found that 6 per cent of Australian consumers expect ‘good times’ for the economy over the next 12 months, compared to 39 per cent who expect ‘bad times’.
Despite the pessimism, it’s expected to be a busy Easter for local businesses with the Australian Retailers Association forecasting $1.7 billion in spending - an increase of 14.5 per cent.
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