While the concept of business confidence only takes in a snapshot of the Australian economy, it provides enterprise leaders will good oversight and the desire to invest in their operations moving forward.
In recent months, Roy Morgan Research reported that confidence increased dramatically, rising 16.3 per cent over September and October thanks to the Prime Minister change. However, this sentiment didn’t extend in November, with the latest release showing a drop of 0.6 points to 118.7 points.
The forecast is certainly not all doom and gloom, with this mark still ahead of the five-year average (116.9 points) and the economy shaping up well for 2016.
Why did business confidence drop in November?
“In November, confidence increased in manufacturing, construction and accommodation/food services.”
The leadership spill wave couldn’t last forever, but there were other factors that put a damper on the progress of recent months. Roy Morgan cited the Paris terrorist attacks and the global climate meeting as major impacts on the international scale. In regards to Australia’s issues, the study acknowledged iron ore prices, tax reforms and budget deficits.
Roy Morgan Research Industry Communications Director Norman Morris explained many industries are still enjoying growing confidence levels.
“There are some good indications that increased confidence in some sectors will help make up for the decline in mining. In November, confidence increased in manufacturing, construction and accommodation/food services,” he said.
“The highest levels of confidence are currently in education/training and retail.”
NAB cites business growth
The Roy Morgan Research statistics are also backed up by the recent figures published by the NAB.
In its Monthly Business Survey, overall conditions were scored at +10 points. This is well above the long-term average (+5 points) and is the fourth consecutive month of growth – highlighting the fact that the Australian economy isn’t dependent on mining.
NAB Group Chief Economist Alan Oster explained this concept in more detail.
“This is basically another strong result for the NAB Survey, which in conjunction with signs of improvement in the labour market, means we can put more faith in the building non-mining sector recovery,” he stated.
How to build on confidence
In comparison to previous months, Australian businesses are in a much better position for growth heading into the new year. However, to take full advantage, enterprises need to have the tools for streamlined operations and further market investment. This is where Advanced Business Manager can be of assistance.
Regardless of your industry, we can provide industry-leading business management software that is adaptable to your needs and can boost productivity for a busy 2016 ahead. For more information, contact us today.