Confidence among small and medium businesses in Queensland has risen to its highest level in seven years, and experts say the Gold Coast is driving a lot of that confidence.
The latest Sensis Business Index survey shows the net balance went up in the Sunshine State for the fourth quarter in a row.
The net balance is calculated by comparing the number of businesses who are feeling confident (59%) to the number who are feeling negative (15%). The score of +44 was up one point this quarter and has risen 14 points over the past year.
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In some not so good news, confidence in Brisbane fell 11 points to +43.
On a positive, there has been an eight point rise to +44 in regional Queensland, putting them ahead by one point.
Sensis Chief Executive Officer, John Allan said: “Queensland businesses are now the fourth most confident in the nation. The result was driven by perceptions that the economy is improving and hasn’t been this good since March 2010. Queensland businesses are now also the most positive in the nation about the long term prospects for the economy.”
The survey was taken before Cyclone Debbie devastated families and businesses across the State, so the next report will survey the impact that natural disaster has had on business confidence.”
Libby Haye Director of Corporate Affairs at Sensis said “in this quarter, regional business confidence, as in on the Gold Coast, is higher than their city counterparts”.
“We’ve been seeing business confidence increase over the last four quarters in Queensland so it’s not terribly surprising.
“However when you look at what is happening on the Gold Coast, I think there are a couple of key reasons as to why.
“So first of all we’ve got the 2018 Commonwealth Games coming up next year and that has meant a lot of opportunities in the tourism, hospitality, construction and transport sectors, so the small and medium businesses are really grabbing those opportunities.
“So in particular, the construction and building sector is registering above the national average in terms of business confidence and with investments in the revamping of Coolangatta Airport, with the Pacific Fair development and literally building the infrastructure required to house all of the athletes coming to the Gold Coast next year, I think that’s really driven a lot of confidence in those business owners.
Ms Haye went on to explain why the result in Brisbane wasn’t as good. She said “I think that because of all that is happening on the Gold Coast, I think that’s really driving business confidence”.
The Index, which reflects the views of 1,000 small and medium businesses from across Australia, also revealed that despite the strong economic results the Queensland Government is now the nation’s least popular state or territory government with SMBs, with the Government’s approval rating falling four points to -22.
“Businesses continue to worry that the State Government takes too much notice of unions and that it doesn’t understand the needs of small business. At the moment only one in fourteen businesses have a positive opinion of the State Government,” said Mr Allan.
Other key findings specific to Queensland are:
– Sixteen percent think the economy is growing versus 14% who think it is slowing, for a net balance of +2, which was up five points and equal to the national average of +2
– Support for the Federal Government was down three points to -3 and sits just below the national average
– Last quarter, the key indicator results were mixed, with only wages and prices higher. Expectations for this quarter are all positive, although only prices and profitability increased.
Nationally, support for the Federal Government among SMBs has fallen into negative territory, down four points to -2, which is the lowest score since Malcolm Turnbull became Prime Minister.
“After Malcolm Turnbull became Prime Minister we saw confidence in the Government rise, with businesses telling us they were optimistic about the change. Since then the Government’s approval rating has fallen nine points and is now in negative territory for the first time since March 2015,” said Mr Allan.
“Less than one in seven businesses now have faith in the Government’s policies, with the biggest concerns being excessive bureaucracy and red tape, as well as there being too much of a focus on the interests of big business.”
While current perceptions of the economy were down one point to +2, the long term projections for the economy have improved to their best level in 2 ½ years, up two points to +10.
“Business owners are feeling the most optimistic they’ve been about the prospects for the economy since the carbon tax was repealed in 2014. Business confidence also remains at one of the best levels we’ve seen in the past seven years,” said Mr Allan.
In terms of business confidence there was a two point fall nationally, with the score now sitting on +44, which is still the second best result since March 2010.
Across the states and territories only ACT, Tasmanian, Queensland and NT businesses became more confident, while WA businesses maintained their score, and the other state and territories went backwards.
At an industry level there were mixed results in terms of business confidence, with seven out of 10 industries going backwards this quarter. The three sectors that improved were Health and Community Services; Building and Construction; and Retail Trade.
“We saw big declines in confidence in the manufacturing and hospitality sectors this quarter, driven by poor sales results, with manufacturing really struggling compared to the other industries. Fortunately, expectations are for an improvement in sales this quarter,” said Mr Allan.
Queensland’s LNP was critical, saying the Index shows the state’s business confidence still lags behind other major states, with Queensland once again neck and neck with Tasmania.
Shadow Treasurer Scott Emerson said Queensland should be leading the nation in business confidence and job creation but sadly we were declining.
“Worse still, the state government’s approval rating fell yet again, and has not once been in positive territory since the 2015 election,” Mr Emerson said.
“It’s clear when looking at the criticisms levelled at the Palaszczuk Government that the business community has no confidence in their economic management or ability to drive jobs.
“Employment conditions actually declined last quarter, with Queensland leading the nation in job losses.”
Quote from Sensis Survey:
The Queensland Government has become the most unpopular in Australia with a rating of -22. Taking too much notice of unions, followed by not understanding small business needs were the main criticisms.
Mr Emerson welcomed the slight rise in business confidence during the March quarter, which comes in spite of the state government’s economic mismanagement.
“Queensland should be firing but instead we’ve got the most “unpopular” government in Australia in charge,” Mr Emerson said.
“Today’s report comes on top of the ANZ-Property Council survey from last week which also showed the Palaszczuk Government was viewed as the worst in the nation.
“Instead of leading the way we are falling behind other states.
“Only the LNP has the plans to deliver jobs and kick-start the economy by building a better Queensland.”
Click here to see the full report.