Roy Morgan has revealed Business Confidence fell 18.2pts in April 2020, marking a 19.1 per cent drop.
The drop in consumer confidence came as 64.8 per cent of businesses revealed they were currently “worse off” financially than this time last year.
“Roy Morgan Business Confidence hit a record monthly low of only 76.9 in April – down 18.2pts (-19.1 per cent) from its previous record low reached in March,” said Roy Morgan CEO Michele Levine.
“The large drop followed the introduction of strict social distancing and self-isolation directives from the Federal and State Governments that persisted throughout the month of April.”
There was some good for businesses.
According to the research, Business Confidence was at its lowest in the first half of the month and started trending upwards as Australia managed to successfully ‘flatten the curve’.
“The good news is that Business Confidence bottomed in the first half of the month and has since improved. For the first half of April Business Confidence averaged only 69.3, similar to its rating for late March of 71.4. Since this low-point the index has improved and averaged 82.0 during the second half of April as Australia ‘flattened the curve’ of new COVID-19 infections,” Levine said.
“There are several bright spots within the results. Perhaps surprisingly, Australian businesses were growing more confident in April about their own prospects with 43.1 per cent of Australians businesses expecting the business to be ‘better off financially’ this time next year – up 3.6ppts from March.”
While some expect to see their businesses get through this, others are forecasting more lasting impacts.
Only a third, 35.9 per cent (down 10.3ppts) of Australian businesses said the next year will be a ‘good time to invest in growing the business’, while nearly half, 48.2 per cent (up 6.6ppts), said it will be a ‘bad time to invest’.
Almost three-quarters (73.2 per cent) expect the Australian economy to experience ‘bad times’ over the next year.
