Small business confidence increased significantly in August following a pre-budget drop, according to the Westpac-Melbourne Institute Small Business Index.
The August Index recorded an increase of 20.1 per cent to 129.9 points, up from 108.2 points in May. This is the highest level since the index was launched.
The Index, which measures the confidence, current performance and future plans of the Australian small business sector, has increased 16.6 per cent over the past 12 months, indicating a significant boost in current business activity and expectations of future business performance.
Westpac’s General Manager of Small Business, Julie Rynski commented that whilst small business confidence experienced a significant drop prior to the federal budget announcement, it is encouraging to see small business confidence returning this quarter.
“I am delighted to see a significant increase in the Small Business Index this quarter. The lift is attributed to post budget confidence, with over a third (36.3 per cent) of respondents saying that the ‘deductibility for assets less than $20,000’ will have the biggest impact on their business. Together with a recent lift in consumer confidence and in turn, spending, it is having a postive impact on the sector.”
‘Customers’ have once again been attributed to be the main positive factor affecting business performance (47 per cent), followed by ‘staff’ (19.2 per cent) and finance (16.2 per cent).