Businesses are more confident about the year ahead according to research by Roy Morgan with 53.9 per cent of businesses expecting to be better off financially this time next year.
While business confidence is virtually unchanged since May (following an 11 per cent bump after the results of the federal election), the positive sentiments continued with 52.3 per cent (up 0.3ppts) of business owners expecting ‘good times’ for the Australian economy over the next five years.
However, confidence is tempered with an air of caution on business growth. Fewer businesses believe now is a ‘good time to invest in growing the business’. 41.2 per cent (down 10.1ppts) of businesses say the next year will be a ‘good time to invest in growing the business’, while 43.4% (up 7.4ppts) say it will be a ‘bad time to invest’.
In addition 38.2 per cent (up 2.1ppts) say the business is ‘better off’ financially than this time last year although just over a quarter of businesses (28 per cent down 2.4ppts) say the business is ‘worse off’ financially than a year ago.
The positive sentiment is not shared across all states and territories, in fact, business confidence has declined in four out of six States for the June quarter 2019 compared to a year ago with the exceptions of Tasmania and Victoria.
Business Confidence in Tasmania in June quarter 2019 was clearly the highest of any State at 142.0, up a significant 16.7pts on a year ago and Business Confidence in Victoria increased 3.2pts to 115.8 over the same period.
In contrast, Business Confidence fell in Australia’s largest State of New South Wales by 11.6pts to 105.9 and was the lowest of any State in the June quarter 2019.
Business Confidence by State – June quarter 2019 cf. June quarter 2018
Source: Roy Morgan Business Single Source, April – June 2018, n=2,621 and April – June 2019, n=2,725.
Michele Levine, CEO Roy Morgan, says that the moderate move in Business Confidence in June confirms that while businesses were happy with the ending of political uncertainty following May’s election, they need to see policy delivery before a further move higher.
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