Finance sector confidence takes slight dip: report

According to the quarterly Sensis Business Index, net confidence for small and medium businesses (SMBs) in the finance and insurance sector fell by nine points.

“The most common reason for confidence was specific business strengths. Falling sales, followed by an unfavourable business environment, were the main issues for worried SMBs in this sector,” the report states.

Last quarter, the only ‘above average’ balance recorded was for profitability. Sales performance was at ‘average’ while prices, wages and employment were ‘below average’.

The prices and employment balances were the lowest recorded by the sector, the report states.

As for this quarter, key indicator expectations are positive and higher than last quarters’ performances. Meanwhile the report, which reflects the views of 1,000 SMBs from across Australia, also revealed that long-term projections for the economy have improved to their best level in over two years.

“Perceptions of the current state of the economy fell slightly, but when we look further ahead businesses are feeling the most optimistic they have been since the carbon tax was repealed in 2014,” said Sensis chief executive John Allan.

“When we look at the key indicators, sales, employment, wages and prices are all positive, while profitability has also improved, despite still recording a negative score. When you mix these results with the fact that business confidence remains at one of the best levels we’ve seen in the past seven years, it’s not surprising to see the long-term economic sentiments improve.”