The fastest drop in survey’s 25-year history!
Even before the COVID-19 pandemic, Australia’s small businesses were feeling stressed by the bushfire devastation and every day cost pressures.
Data from the Sensis Business Index which measures small business confidence shows a massive drop in confidence in just two weeks as the reality of Coronavirus hit Australia. Confidence fell from positive 40 on 10 March to negative 13 on 24 March.
“Australia’s small businesses were feeling the squeeze before the impact of the Coronavirus hit,” said Sensis CEO John Allan. “But the massive fall in confidence in just a matter of 14 days, while not a surprise, was the fastest drop in the 25-year history of the survey”.
The first survey respondents were in early March but as time progressed the stark reality of COVID-19 hit Australia’s small businesses quickly with sentiment changing mid-survey. At the start of March, 29.7% of SMBs had seen no impact on their business with 35.6% expecting to see an impact in the coming months.
By the third week of March, 32% had seen a severe impact, 35% had seen some impact and 26% were expecting an impact. “The extraordinary speed of the change in confidence is not something we’ve ever witnessed before; it was as if a speed train had hit the majority of small-medium businesses in Australia with 47% surveyed now worried about the future” says Allan.
“Despite the realities of lockdown, more than one-third (34%) of small businesses were showing resilience and still confident about the future, suggesting they are hopeful about a quick bounce back post lockdown,” said Allan.
Small businesses across the country were not confident about the economy going into lockdown. 64% believed the economy had contracted and 30% believed it had stalled. 60% believe the economy will be in worse shape in 12 months.
Around the country
In terms of the state and territory economies, 57% of SMBs believe their state economy is shrinking, and 35% believe it is at stand still. South Australian SMBs were most pessimistic with 67% feeling the SA economy was shrinking.
“ACT small businesses were the most confident (47.3% were confident) while South Australian SMBs were the most pessimistic (52.3% not confident).”
In the March quarter nearly one-third (30%) of SMBs saw the value of their goods or services decline and 44% reported that the prices they pay for goods and services they use increased during the quarter.
The Sensis Business Index is based on 1,015 online interviews conducted between 4 and 28 March 2020 with small and medium business proprietors or managers employing up to 199 people. This sample is drawn from metropolitan and major non-metropolitan regions throughout Australia with targets set for location and industry on page 36. Glow is responsible for fieldwork and Dynata for sampling.
For full access to the survey data, please email email@example.com or call 0488 34 54 64.
Report available here – https://www.sensis.com.au/about/sensis-business-index