The ABS has released its latest dataset that shows signs of a sizeable recovery and increased business confidence across the board in the Australian economy.
The ABS has released its latest Business Indicators, Business Impacts of COVID-19 report which looks at revenue figures, employee numbers, operating expenses and capital expenditure, and has been updated monthly to reflect the changing impact of the COVID-19 pandemic on Australian businesses.
Judging by the latest data, the Australian economy is showing signs of a sizeable recovery with increased business confidence, matched by increased forecasts for spending and revenue for the month of December.
Key headlines of the release include the fact that 24% of businesses have reported an increase in revenue, which was 8% higher than the 16% of businesses reporting an increase of revenue in October. The ABS report states that “this is the first time in the monthly series that a greater proportion of businesses have reported increased revenue (24%) compared to decreased revenue (22%).”
This was matched by 22% of businesses reporting that they have capital expenditure plans for the coming fiscal quarter.
The ABS says that “the proportion of businesses reporting economic uncertainty as a factor influencing their capital expenditure has halved since August, falling from 59% to 29%,” in its latest report.
The good news is set to continue for a number of Australian businesses as they move into the month of December, with the ABS reporting that 25% are expecting increases of revenue for the month. “This is more than twice the proportion that expected an increase in revenue for August (11%) and September (9%),” the report says.
The accommodation and food services sectors were most likely to report an increase in revenue (49%) over the month of December, while utilities like electricity, gas, water and waste, as well as the retail sector are expected to jump 36% and 32% respectively.
The COVID-19 pandemic is still having a lasting impact on the economy, says the ABS. According to its latest figures, just 8% of businesses reported they planned on increasing employee numbers, with medium and large businesses twice as likely to hire employees over small businesses; 20% compared to 8%.
The ABS’ Head of Industry Statistics, John Shepherd has said that the November data indicates a sizeable recovery for the economy, as well as a renewed sense of business confidence.
In terms of capital expenditure, the ABS says that the forecast looks good for large-sized businesses, who are twice as likely to report significant capital expenditure increases over medium (24%) and small (10%) businesses. The ABS says that “businesses in retail trade (41%) were the most likely to report planned capital expenditure over the next three months while businesses in Administrative and support services (7%) and Transport, postal and warehousing (7%) were the least likely.”
“As well as a greater proportion of businesses experiencing an increase in their revenue in November, one quarter (25 per cent) expect revenue to increase for December. Some businesses commented that seasonal factors had influenced these expectations.”
“One in five (22 per cent) of businesses indicated they have capital expenditure plans over the next three months, with about three quarters (73 per cent) of these businesses expecting to spend the same or more than what is usual for this time of year.”
“We asked businesses what had influenced their capital expenditure plans,” Shepherd said. “The most common factor reported by businesses was future economic uncertainty (29 per cent), however the proportion of reporting this as a factor has halved since August (59 per cent),” he said.