Roy Morgan Research’s November 2013 Business Confidence is down 5.2 points in the month to 131.1. The level of 131.1, is still well above the average of the last three years, however, if the November figure is a sign of further decreases to come in Business Confidence then Australia may see more decisions like Qantas has just announced.
The drop in confidence among business in November was caused by a decline in positive feelings about where the economy is heading in the next 12 months and the next five years. There has also been a small drop in the proportion of businesses considering that the next 12 months are a good time to invest in growing the business.
This decline in Business Confidence in November was across all business sizes, with micro business down 5.4 points to 129.4, small business down 4.4 points to 143.3 and medium/large business down 3.4 points to 146.9. Medium/large businesses (turnover $5m+ p.a.) have clearly been the most confident over the last three years and in November, despite a small drop off in confidence, they remain at an historically high level.
All states have suffered some loss in business confidence during November, with the biggest losses being in WA and SA. The most positive is Queensland, currently on 136.4, followed by NSW (134.0). The states with below average business confidence are Tasmania (124.5), WA (125.6), Victoria (126.4) and SA (131.0).
Of the major industries, Mining still leads confidence in November with 149.7 (down from 156.4 in October), Retail is around average with 131.6 (up from 126.8 in October) and Construction is on 127.9 (up from 122.9 in October). The agricultural sector remains well below average with 121.9 but was up slightly on the 118.7 recorded in October.
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
