BUSINESS CONFIDENCE BOUNCING BACK BUT STILL FRAGILE

Business Illawarra has today released its December Business Conditions Survey, saying that while the results reflect growing resilience and optimism in the face of COVID-19, this confidence can be quickly eroded by further COVID-19 outbreaks, lockdowns and border closures. 

“Illawarra businesses told us they were turning the corner following the ravages of the COVID-19 pandemic, with all key indicators trending upwards in our region,” said Adam Zarth, Executive Director of Business Illawarra.

“The survey shows that business confidence in the Illawarra was positive for the first time since September 2019, however much of the survey was completed prior to the Northern Beaches outbreak and Wollongong’s inclusion in the Sydney ‘red zone’,” said Mr Zarth.

“What this survey does clearly show is the resilience and optimism amongst the business community in the Illawarra coming out of an exceptionally challenging year in 2020.”

“The NSW Government has done a good job in listening to business needs and responding as soon as possible by easing restrictions and opening up communities.”

“However, since the survey results were finalised, we’ve heard from local business owners about how quickly confidence can be eroded following new outbreaks, lockdowns and border closures.”

“The first quarter of this calendar year will be crucial for many businesses as a number of government support packages are also reduced or come to an end.”

“Despite overall increases in confidence, 23 per cent of businesses state-wide claim they are at a high risk of failure when supports such as JobKeeper, tax relief, interest waivers and other measures conclude.”

“This vulnerability will hang over the small business sector for much of the year and will need to be factored into decisions about withdrawing support measures.”​

“The other clear signal from our survey is that an increasing number of Illawarra businesses are looking to expand their capacity to meet demand, with more businesses prioritising expansion than planning to downsize their business.”

“Illawarra businesses have also indicated an increased inclination to hire new staff which is another encouraging sign,” Mr Zarth said.