Commonwealth Bank Chamber of Commerce & Industry Queensland Pulse Survey of Business Conditions for the March Quarter 2010
4 May
Business expectations have moderated from the all time high that we saw last quarter but remain quite positive despite a failure to see significant improvements in sales and profitability, according to the latest Commonwealth Bank Chamber of Commerce & Industry Queensland (CCIQ) Pulse Survey of Business Conditions.
According to the March Quarter results business confidence has declined 1.5 points with the Queensland Economic Conditions Index down to 55.8 per cent.
CCIQ President David Goodwin said the latest Pulse results show the Queensland economy is not yet out of the woods.
"National and state business confidence rebounded strongly in late 2009 on the basis of growing expectation that there would be an economic recovery in 2010 and the national and state economies would perform well this year," Mr Goodwin said.
"While most businesses continue to look to the future with optimism, a continuing concern is the divergence between expectations and actual business performance and the weaker than expected performance of profit, sales and revenue. This will only be compounded by the Federal Government's response to the Henry Review of taxes.
"Forty per cent of businesses experienced weaker sales and revenue in the first three months of 2010 and not surprisingly the majority of businesses (46 per cent) reported weaker profits.
"Queensland has gone from the boom state to the lag state."
Mr Goodwin said that the latest results further highlight the need for government to stop taking money out of the back pocket of business.
"Electricity prices have gone up and are about to go up again, WorkerCover premiums have just been hiked, employer superannuation contributions are to increase and we have not even had the State and Federal Budgets handed down or the dust settled from the Henry Review of Taxes released over the weekend. The reality is business is being hit on all sides," Mr Goodwin said.
"In addition businesses ability to invest is being constrained by the lack of finance. All of this is driving a more cautious approach from the Queensland business community and hesitancy to spend or invest.
"While there is reduced optimism from three months ago the reality is Queensland is increasingly a resource reliant state and we may well see a return in confidence should recent announcements of significant resource projects come to fruition.
"The key here will be to ensure that all benefit from this boom, otherwise we are left with a one-sided, two tier economy.
"Businesses in all regions of Queensland remain cautiously optimistic, but economic recovery is patchy and remains anticipated not realised.
"More than 850 Queensland businesses are telling us their sales are not yet reaching their targets and we must take seriously the growing chorus calling for a fair go from our country's politicians."
Mark Toon, General Manager Corporate Financial Services Queensland, Commonwealth Bank, said it's encouraging to see that business owners in Queensland have put 2009 behind them, and are focusing on a positive year ahead.
"That said, it's not all smooth sailing. Many business owners are concerned about rising interest rates, the winding back of the Government's stimulus measures, falling house prices and the upcoming Federal election," Mr Toon said.
The Pulse Survey has been measuring Queensland business confidence and expectations for over 20 years and is published in cooperation with the Commonwealth Bank. The survey is unchallenged in terms of being the most authoritative, timely and comprehensive snapshot of Queensland business sentiment with over 850 Queensland businesses interviewed as part of each survey.
