Manufacturers expect improved conditions, says ACCI Westpac survey

Australia’s manufacturers expect that general business conditions in the next six months will be better than the previous half-year, the latest Australian Chamber of Commerce and Industry-Westpac Survey of Industrial Trends has found.

The ACCCI-Westpac Survey results come as almost a quarter of Australian SMEs intend to give employees a pay rise in 2015, despite concerns on how they will attract more customers, according to the latest MYOB Business Monitor.

The ACCI-Westpac March-quarter Survey comes at a time of a falling Australian dollar and falling interest rates, easing cost pressures.

The survey found a net positive 8% of responses on the question of whether the general business situation in Australia will improve over the next six months, while down on a net positive 27% in the previous December-quarter survey.

When asked about their own firms respondents were more optimistic, with a net positive of 13% saying they expect their firm’s profitability to improve in the next 12 months. This reflects a modest but continuing underlying positive trend, following a 23% per cent net positive result the previous quarter.

Andrew Hanlan, senior economist at Westpac, said that the Westpac-ACCI Composite Index rose in the March quarter to 56.2, up 2.0 points from 54.2 in December.

“This result, the sixth consecutive reading in the expansionary zone, indicates that conditions are improving in the manufacturing sector. The strengthening of the Composite Index is being driven by lifts in new orders, output and overtime but not employment,” he said.

The bi-annual MYOB national survey of more than 1000 small to medium business owners found that, when it comes to attracting new customers, 32% said that is ‘quite likely’ or ‘extremely likely’ to put pressure on their businesses over the next 12 months, while a further 35% said that it is ‘likely’ to cause some pressure.

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