The uncertainty associated with the looming federal election, along with concerns over key policy areas such as workplace relations, are hurting business confidence according to the latest quarterly survey by the NSW Business Chamber.
Business conditions have fallen sharply as the NSW economy slows down, with the largest drop in business confidence recorded since July 2010.
The survey was taken immediately prior to the NSW election in March.
“A surprising number of businesses are worried about the upcoming federal election. With the very real prospect of a change in government in Canberra, businesses appear uncertain about what it will mean for them,” said Adam Zarth, Executive Director of the Illawarra Business Chamber.
“We are seeing this sentiment expressed across the Illawarra-Shoalhaven as well as the Southern Highlands. As a result of the uncertainty, businesses are in a holding pattern and the brakes have been put on capital investment and business expansion,” Mr Zarth said.
In the Illawarra, capital spending is down significantly, with 60 percent of businesses reporting less planned or actual investment since the December 2018 quarter, which is 25 percent worse than the state average. Around 60 percent of businesses have reported a drop in profits and sales revenue in the months leading up to the election as well, which is also down markedly on the state average.
Elsewhere in our region, the Shoalhaven and Southern Highlands was closer to, though still worse off, when compared against state-wide figures.
“If these results are reflective of wider sentiment then we have cause for concern – they represent a very sharp drop,” said Mr Zarth.
“The latest retail trade statistics released by the ABS point to a fairly modest increase in retail turnover rose, up 0.6 percent across the state in February 2019, which is likely also adversely affecting business conditions.”
Workplace relations are another influence playing on the minds of many small and family operated businesses and shapes up to be a key federal election issue for businesses.
“Issues such as ‘double dipping’ for casual workers and the perception of greater union disruption in sectors such as construction are factors that are worrying business owners across the state and locally,” said Mr Zarth.
Full survey results, including detailed regional and industry-level data, can be found at
. ABS Retail Trade figures for February 2019: https://bit.ly/2In9TXb
James Newton (0417 135 858)