BUSINESS CONFIDENCE RETRACTS AS OMICRON BITE DEEPENS

Business confidence in the Hunter region has taken a hit in the wake of the Omicron surge, according to results for the region extracted from a recent survey conducted by Business NSW.

The survey was conducted up to the third week of January and had more than 3,000 respondents across the state and around 300 across the Hunter, from a variety of industries and sectors, and business sizes.

“Business confidence and perceptions in the Hunter are lower now than they were in the first half of 2020 and business owners are reckoning it will get worse before we see improvement beyond the next quarter,” said Business Hunter Chief Executive Officer Bob Hawes.

“The optimism we saw in the September 2021 survey has been wiped away and the sentiment is definitely negative at the current time Mr Hawes said.

“Through 2021 Business Hunter often noted that many sectors of our economy were relatively unscathed by the pandemic. Not this time around. Not under Omicron” Mr Hawes said.

“It’s fair to say the Hunter region had been performing relatively well through to October 2021 however, we have not been spared in this wave and the impacts are fairly plain to see in a range of businesses. We’re not just talking hospitality, entertainment, and retail in this season of COVID.

“Unlike previous surveys through 2021, where business owners felt the next quarter would get better, that isn’t the case this time as there are limited government support packages in place. The scale of Omicron has taken everyone by surprise and created an environment that is impacting businesses of all types.

Business Hunter is seeing that comprehensive supply chain issues are the economic variant of this current COVID variant with members reporting significant, almost crippling shortages in food delivery but also being felt deeply in manufacturing, construction and mining supply chains.

“These supply chain businesses aren’t ‘locking down’ per se, but are finding the current business environment really challenging as staff and supply shortages are impacting their capacity to deliver and this is felt further and further down the line. If our businesses can’t produce essential products and services and get them to the markets that need them, well, that’s a completely different economic ballgame to people not being able to go out for dinner.

“What’s important is that confidence returns with speed – business needs to work with Government to ensure messaging is geared towards how consumers can spend freely in safety, that immediate supply chain issues are being resolved and the workforce is re-engaged as quickly as possible.

“The survey has shown that business across the board are unwilling and often unable to spend on capital equipment and in respect of their revenue forecasts with the only bright spot being a belief they can hold firm on operating costs.

“67% of businesses expressed the need to have support programs reinstated in the next three months and also positively rated the commercial rent relief package which the state government has fortunately just recently extended. Comments to the survey indicated that viability is not just about money and business continuity and the availability of staff was the stand-out issue.

“Confidence can return quickly, but for many businesses the next three months will determine their capacity to survive and thrive alongside COVID in the longer-term, Mr Hawes said.