WA business confidence has hit shaky ground as the WA economy continues to find its feet following the end of the resources construction boom.
The latest WA Super–CCI Survey of Business Confidence conducted is the only WA-specific index in the country, providing a snapshot of state-wide economic conditions and business expectations.
CCI Chief Economist Rick Newnham said 45 per cent of WA businesses are expecting the economy to weaken this quarter while business investment continues to fall, albeit at a slower rate than previously.
“The expectation from business is short-term pain followed by longer term gain. More businesses (45 per cent) expect the economy to be weaker in the next quarter than expect it to be stronger (16 per cent),” Newnham said.
“Businesses are more optimistic about the future with most (86 per cent) expecting the WA economy to improve or stay the same in the next 12-months. This is, however, down 6 per cent since the last quarter.
“This decline in confidence isn’t all doom and gloom, with confidence remaining above its 10-year average, but it is a sign that we cannot take growth for granted, especially when we compete on the international stage.
“Mining businesses are leading the growth in confidence in the WA economy, with every business surveyed in the mining sector expecting stronger economic conditions for the year ahead.”
The survey revealed 69 per cent of businesses in manufacturing and 64 per cent in professional services also remain confident about WA’s long-term economic trajectory, however businesses in retail are continuing to struggle, with 21 per cent expecting economic conditions to worsen following low growth in retail sales across WA.”
The WA Super–CCI Employment Index is showing continued signs of recovery and prospects for investment growth in WA remain promising.
“Twenty-eight per cent of businesses reported increasing their employment levels this quarter, while 49 per cent kept staff levels steady. These conditions are expected to continue to improve next quarter, with four out of five businesses anticipating increases or no staff changes,” Newnham said.
► You can read the WA Super–CCI Survey of Business Confidence here.