SMB confidence has reached its highest level in over five years. For the current quarter SMBs remain positive and expect the economy to improve, although the overall assessment remains negative.
The key findings of the Sensis Business Index June 2016 are:
- SMB confidence increased by nine points to a net balance of +44, the highest level seen since March 2011 when it was also +44.
- Confidence was above the national average in NSW (up 10 points to +58), the ACT (up nine points to +49) and Victoria (up seven points to +46). It also rose in Queensland by six points to +36, SA by 24 points to +29 and WA by nine points to +20. Reduced confidence was observed in the NT (down four points to +23) and Tasmania (down 17 points to +30). In the last two quarters confidence among Tasmanian SMBs has more than halved from +64 to +30.
- The economy is perceived as having improved but the overall assessment remains negative. More SMBs believe the economy is slowing (24%) than growing (16%). The net balance of -8 has improved from -22 last survey. SMBs are also slightly more positive about the health of the economy in 12 months’ time, with the net balance up from -6 to -3.
- Last quarter, sales and profitability balances were not impressive but there was modest improvement. The employment, wages and prices results were similar to last survey.
- For this quarter, the expectations for all of the indicators remain positive, although they went backwards, with sales down four points (+21) and employment down six points (+5).
- The primary barrier to taking on new employees remains a lack of work or sales. Other barriers are far less pronounced.
- The Federal Government is less favourably perceived this quarter, although a positive net balance remains - down from +6 to +2. Tax incentives, being supportive and trying to help small businesses influenced positive perceptions of the Government. High taxes, a lack of incentives or support and an excessive focus on big businesses were the main criticisms.
- Among the state and territory governments, only NSW has a positive net balance, up four points to +12. The NT Government gained some favour but sits on a neutral net balance. All the other governments lost appeal, especially in Tasmania (down 16 points to -2), the ACT (down 11 points to -2), WA (down 12 points to -21), Queensland (down nine points to -26) and SA (down seven points to -29). The Victorian Government is also relatively unpopular (down two points to -13).