CCIWA’s latest Regional Pulse report shows higher operating costs have swept aside signs of steadier business confidence from three months ago.
“The key challenges of the past two years – skills shortages, supply chain disruptions and COVID – have been overtaken by punishing operating costs, which are wearing down regional businesses,” says Aaron Morey, CCIWA’s Chief Economist.
“The State Government could provide relief to regional businesses by easing WA’s uncompetitive payroll tax burden.”
Read the Regional Pulse report
On average, regional businesses are less optimistic than metro businesses in the short term but have similar levels of optimism over the longer term, the July quarter report shows.
Businesses in the Pilbara (55%), Goldfields-Esperance (44%), and Mid-West/Gascoyne (31%) regions are most optimistic over the next three months.
Nearly one quarter (23%) of businesses in the South West, one in five (20%) businesses in the Wheatbelt and about one in 10 (12%) businesses in the Great Southern expect stronger economic conditions over the next three months.
For the South West and Great Southern, this is likely underpinned by expectations of weaker tourism, higher operating costs and skilled labour shortages. The Wheatbelt outlook may reflect drier conditions impacting growing conditions.
Morey says rising operating costs remain the leading worry for WA’s regional businesses, impacting four in every five (80%) respondents. This is especially the case in the Goldfields-Esperance (89%), Wheatbelt (89%) and Pilbara (82%) regions.
“Soaring costs have eroded the profit margins of one in every two regional businesses,” he says.
The full Regional Pulse Report is available to CCIWA members.
CCIWA’s Economic reports, including Regional Pulse, are available exclusively to CCIWA Advantage and Corporate Members. For more see CCIWA’s Economic Insight page.
