New Sensis survey says transport and storage businesses are feeling buoyant
Small and medium transport and storage businesses are feeling more confident this quarter according to the Sensis Business Index June 2016, but are still lagging behind the national average.
Like the national average, which reached a five year high in latest quarter, the confidence is growing in the transport and storage industries on the back of positive indicators in all five key areas but it is coming off a poor period.
This past quarter has seen jumps in sales (+20), profitability (+21), wages (+14), prices (+10), and employment (+7), in stark contrast to the previous quarter where the net balances for sales dropped 14 points and profitability fell 17 points.
In terms of prices, the recent quarter grew on the previous quarter’s marginal positive of +3, but employment actually fell over the last three months from being the top industry at the time with +8.
The industry’s view on the policies of the federal government jumped by 13 points in the quarter, the second highest of any industry behind Finance and Insurance.
On the back of the confidence boost, the transport industry has jumped 18 points and now sits ten points behind the national average of 44 points.
The breakdown saw 52 per cent of the industry presently confident and 18 per cent worried.
“This sector is more confident but still trails the national average after experiencing a difficult quarter,” Sensis researchers say.
“Despite this, expectations are fairly positive.”
Courtesy Sensis.
In what has been an up-and-down 12 months for the industry, with confidence levels falling below 10 in June 2015, jumping to over 30 the following quarter, and the diving back down to 16 in the first quarter of 2016, Sensis says “good sales and being an established, solid business are the prime drivers of confidence.”
However, it’s not all smooth sailing with “poor sales and difficult business conditions” the primary concerns for those struggling.
National picture
In terms of the rest of the rest of the business community, confidence is at a five year high.
Reaching the 44 point mark, the survey found 60 per cent of participants were feeling confident and 16 per cent worried.
Despite this, Sensis CEO John Allan says “wages and profitability went backwards this quarter.”
“These are not the results you would expect to see when confidence has lifted to a five year high,” Allan says.
“Rather than being driven by these indicators, confidence is instead being driven by perceptions that the overall economic environment is improving.
“On top of this, the non-cyclical influences remain strong, with businesses continuing to feel particularly positive about their own specific business strengths.”
Allan says that while perceptions of the economy remain negative, “they have improved to the best level we’ve seen in two years.”
With the exception of Tasmania and the Northern Territory, the states are all growing in confidence too.
South Australia has jumped Western Australia to no longer be the least confident state, thanks to a 24 point rise.
“The eastern seaboard states are now the shining lights for business confidence nationally,” Allan says.
“As you head across the continent, however, confidence deteriorates, with businesses in the Northern Territory and Western Australia the least confident in the nation, followed by South Australia.”
Tasmania, which led the country two surveys ago, now sits below the national average.
Confidence in both metropolitan and regional areas is up, rising 13 and 4 points respectively.