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Survey shows business confidence softens after recent optimism
A SOFTENING in business confidence has characterised the first quarter of 2014 despite the initial highs of the post-federal election period and a stronger-than-expected December 2013 quarter, according to the latest VECCI - Bank of Melbourne survey of business trends and prospects released today by Victoria's peak employer body.
The state-wide survey of more than 400 businesses shows that 27 per cent of Victorian businesses anticipate stronger national economic growth over the next 12 months. While this is still positive, it is noticeably lower than last quarter when 40 per cent of respondents held this view when surveyed at the end of 2013.
A similar softening was reported in expectations for the Victorian economy, which is unsurprising given the recent closure announcements from automotive manufacturers and Alcoa. However confidence remains well ahead of the reported lows in 2012 and early 2013.
In the three months to March 2014, general business conditions and sales remained largely unchanged, while falls in selling price were widespread, adversely affecting profitability across a broad range of industries.
The fall in confidence is also reflected in the reported continued decline in investment in buildings and structures. Employment and plant and equipment investment were flat.
“These findings reinforce the importance of governments continuing to prioritise measures that will improve business conditions, in particular by reducing business costs and regulations," says VECCI Chief Executive Mark Stone.
“Victorian business is eagerly anticipating the upcoming state budget which presents a timely opportunity to lower employment stifling taxes such as payroll tax, and accelerate important productivity and job enhancing infrastructure across the state.”
Bank of Melbourne Chief Executive Scott Tanner says: “The Victorian economy is going through a period of transition but remains fundamentally sound. We expect growth will continue to be slow and steady rather than a return to the boom times as the global economy continues to undergo structural change".
VECCI & Bank of Melbourne partnership
VECCI is pleased to partner with Bank of Melbourne. The bank supports VECCI’s quarterly VECCI - Bank of Melbourne survey of business trends and prospects, Business Leaders event series and Women in Business event series. The partnership builds on the mutual goals of both VECCI and the Bank of Melbourne in supporting businesses in Victoria.
VECCI
The Victorian Employers' Chamber of Commerce and Industry (VECCI) is the peak body for employers in Victoria, informing and servicing more than 15,000 members, customers and clients around the state.
www.vecci.org.au
Bank of Melbourne
Bank of Melbourne is helping build a better Victoria. Since launching in July 2011, the bank has tripled its workforce, opened 84 branches and become more involved in the local community. The bank partners with Victorian organisations and events including the MCG and Melbourne Food and Wine Festival. It’s shaping a vision for the future of our state by supporting industry with initiatives including Agenda Victoria. As a full-service bank, its team of lenders, account executives and industry specialists are supporting Victorian businesses, both large and small.
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