High energy prices, cyber security woes and escalating interest rates has cratered the confidence of Aussie businesses, with not even the upcoming Christmas period generating any excitement.
The new Business Conditions Survey from Business NSW revealed a level of pessimism equal to that seen in the pandemic and, prior to that, the Global Financial Crisis.
The headline business confidence index (BCI) came in at -64.3, slightly less negative than the previous reading of -68.6.
However, for the first time since March 2020, the reading that captures expectations for the next quarter dipped below the headline BCI.
In other words, as bad as the business community feels about things now – they think it will only get worse, even over the traditionally big-spending holiday period.
“Apart from the pandemic, the last time we saw this happen was 2009 in the aftermath of the GFC,” Business NSW CEO Daniel Hunter said.
“This survey serves as a wake-up call to all of us that businesses are struggling to emerge from the pandemic.”
The report also reveals NSW businesses largely rejected the Federal Budget handed down in October.
On a scale of zero to 10, two-thirds of respondents rated the budget with a score of four or below in terms of its support for the NSW business community.
The average score was 3.1.
“There is a consensus that the latest Commonwealth Budget is not doing enough to support business in NSW,” Hunter said.
“Business understands the need to build a stronger, more resilient economy and the need to tackle inflation.
“That’s why governments, state and federal, need to press on with skills and tax reforms, support during energy transition, more investment in innovation and a coordinated state-federal productivity agenda.”
Businesses were also pessimistic about their cyber-security readiness, following the hacks perpetrated against Medicare and Optus.
Half of all respondents rated their preparedness for cyber attacks at five or less out of 10. The average score was 5.4.
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