Manufacturing small and medium sized businesses have experienced another fall in confidence, according to the latest Sensis Business Index (SBI).
A drop in business and difficulties competing with cheap imports dragged confidence down five percentage points during the June quarter. Small and medium sized enterprises (SMEs) in the manufacturing sector have the lowest confidence levels of all sectors.
The SBI, based on extensive research of 1,800 small and medium enterprises (SMEs) and reported as a net balance (positive minus negative), revealed manufacturing confidence was at a net balance of 0%. This compared with finance and insurance at +41% which saw the highest confidence.
Christena Singh, Sensis Business Index report author, said: “The confidence of the manufacturing sector continues to fall and they also reported the lowest employment expectations. Conversely, the finance and insurance sector cited plenty of work coming up, profitability being good and government policies as reasons for confidence.”
Elsewhere, the health and community services and building and construction reported confidence at +18% compared with retail trades at +7%, transport / storage at +13%, communication, property & business services at +1%, cultural, recreational and personal at +26% and accommodation, cafes and restaurants at +14%.
The largest decrease was in the wholesale trade sector where confidence was down 40 percentage points (at +9%). SMEs in this sector were concerned with the value of the dollar and instability in the market. Despite this, the sector reported the strongest expectations for sales and capital expenditure for the current quarter.