Confidence reached a record high in October, with a majority of Australian businesses factoring in good conditions over the next 12 months, according to research from Roy Morgan Research.
The research house’s October business confidence survey found that sentiment rose to the record high level of 136.3 points – the highest recorded since the survey began in December 2010.
“Business confidence in October reflects both business approval for the change in government and a more general improvement in business performance,” Roy Morgan Research director of business research Nigel Smith said.
“The mining industry clearly believes the change in government will have a beneficial impact on their businesses, despite what appears to be an otherwise negative outlook for that industry.”
In addition, the proportion of businesses expecting Australia to be in a good position financially over the next 12 months rose to a record high of 76.7 per cent, with the percentage expecting the worst falling to a record low of 23.2 per cent.
Businesses also have a similar outlook for the next five years, with the proportion expecting good times rising to a record 80.4 per cent compared with a record low for those expecting bad times, at 19.7 per cent.
Twenty-eight per cent also said they were better off now than at the same time last year, with 27.7 per cent claiming they are now worse off.
Manufacturing, accommodation and food services, finance and personal services industries all recorded their highest level of business confidence to date.
“While sources such as the Reserve Bank appear to forecast the next 12 months to be particularly tough for Australian businesses, businesses themselves do not appear to share this pessimism,” Roy Morgan’s Mr Smith said.
“The retail, accommodation and food services and personal services industries, in particular, have their highest figures we have yet recorded coming into the Christmas season.”
Written by a staff reporter for Investor Daily.