The Australian Chamber of Commerce and Industry Small Business Survey shows that business conditions have continued to deteriorate over the June 2008 quarter, falling to the lowest level recorded since the survey began in December 1996.
The survey assessed business conditions and confidence among 2,121 businesses around Australia over the April, May and June period.
The survey also found that:
• Business expects a further decline in Australia’s rate of economic growth over the next 12 months. This index is also at its lowest level since December 1996 and more than 15 points below its five-year average.
• The growth of sales revenue has declined further and fell into negative territory over the quarter for the first time in five years. Expectations also moderated from previous figures but remained positive.
• Selling prices growth continued to moderate over the quarter.
• Profit growth continued its significant decline below the key 50.0 level to 38.8 – nine points below the five-year average and the lowest level since this survey began. Expectations for the September quarter were also negative, indicating small business is not confident of a quick recovery.
• Growth of investment in plant and equipment has slowed from the previous high levels while the growth rate for investment in buildings and structures remained negative.
Greg Evans, director of industry policy and economics at the ACCI, is calling on the Reserve Bank to cut official interest rates to arrest this slide in small business activity.
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