Customer Centre

Bill Pay Info | About Customer Centre

Weak spending bottoms SA business confidence

June 30, 2011

Business confidence has tumbled in South Australia during the quarter to be the lowest level in the nation, according to the Sensis® Business Index released today.

 Report author Ms Christena Singh said weak consumer demand had caused South Australian small businesses to become increasingly pessimistic about their business prospects over the next 12 months.

 “South Australian small businesses also hold the nation’s most pessimistic views about Australia’s current economic position as well as the economic outlook a year from now,” she added.

 The Sensis® Business Index shows South Australian small businesses experienced weaker trading conditions during the quarter and were expecting sales and profits to decrease in the short term.

 Given the topical nature of a proposed carbon tax in Australia, the Sensis® Business Index also asked South Australian small businesses specifically about their views.

 Thirty-five per cent of South Australian businesses said they did not understand the proposed carbon tax, while 54 per cent said they partially understood. Eleven per cent said they had a thorough understanding.

 Fifty-three per cent of South Australian small businesses said a carbon tax would have a negative impact on their business, while 42 per cent believe it would have no impact. Five per cent believe it would have a positive impact on their business.

 According to the findings, South Australian small businesses are most concerned about a carbon tax impacting on costs, with lower consumer demand and a negative impact on the economy also key reasons.

 For those South Australian businesses that felt the carbon tax would have a negative impact on their business, 13 per cent said they would consider selling or closing their business (the highest level in the nation), with six per cent looking at modifying products and services and four per cent decreasing staff.

 The report shows support for the South Australian Government fell during the quarter.

 Key South Australian findings from the June 2011 Sensis® Business Index:

·         Business confidence fell from 35 to 16 per cent (28 per cent nationally)

·         Profitability improved marginally from negative 17 per cent to negative 16 per cent (negative 14 per cent nationally)

·         The sales indicator fell from negative 10 to negative 13 per cent (negative 14 per cent nationally)

·         Overall employment by South Australian small businesses fell during the quarter, taking the indicator from positive two per cent to negative three per cent (one per cent nationally)

·         Support for the South Australian Government fell from negative 36 per cent to negative 38 per cent.