High rates of unemployment and low participation rates could have contributed to a dip in business confidence revealed by the latest data from the Sensis Business Index.
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The index released its December results on Tuesday, which showed Tasmania was the only state in the country to drop in business confidence despite the improvement in the state government’s rating.
Launceston Chamber of Commerce chief executive Jan Davis said confidence among Tasmania’s small business community remained uneasy, which could be traced over the last three index results.
“Over the last three survey periods Tasmania has gone from well above the national average to below. This to some degree reflects specific local conditions,” she said.
Ms Davis said high unemployment rates and low participation rates were two factors that could have contributed to the result.
However she said the outlook for Launceston small business owners remained positive, despite the result.
“There’s a lot of exciting projects ready to come online in Launceston in 2017 and this will provide strong economic impetus,” she said.
“As we head into the new year it’s good to see that many businesses are feeling confident about their own prospects.”
The survey report reflects the views of 1000 small and medium business owners across Australia. Compared to this time last year Tasmania’s result is down 26 points with the key indicators continuing to be mixed.
The net balance score was down 14 points to +38 points that dropped Tasmania from second place to below the national average at +48 points, up eight points from last quarter.
However, small business owners reported the highest satisfaction in the state government, which put it the top of the table for that rating.
Ms Davis said being an established business was the main driver of confidence ahead of specific business strengths and healthy sales with worried small business owners highlighting falling sales as their main concern going forward.
“While still among the most positive recorded across the nation, the report shows that expectations for the year ahead were lower for sales, employment, wages and profitability. At the same time, expectations for prices and capital expenditure rose.”
Small Business parliamentary secretary Roger Jaensch said recent moves to streamline building and planning regulations, abolishing water and sewerage headworks charges and the introduction of a local benefits test for government tenders were all ways the state government was listening to small business.
“This is a pro-business government and this is the latest survey to confirm that, following on from the TCCI’s recent survey, which showed business confidence was increasing,” he said.
“But there is always more that we can do. That’s why we will continue to work with the business sector to grow the economy and create jobs.”
Future projects for the government that will assist small business include new University of Tasmania campus developments in Launceston and Burnie and the $100 million Northern Tasmania stimulus funds.
Tasmania has about 37,000 small business owners with about 100,000 people employed in the industry.