Businesses bouncing back but still fragile

Business confidence across the Hunter region and NSW continued to improve across the December 2020 quarter based on the results of the latest Business Conditions Survey conducted by Business NSW.

“In the December Business Conditions Survey, NSW businesses told us they were turning the corner following the ravages of the COVID-19 pandemic,” Hunter Business Chamber CEO Bob Hawes said.

“The survey, conducted right across NSW, showed the NSW Business Confidence Index was positive for the first time since June 2018.”

Mr Hawes said that while much of the survey was completed prior to the Northern Beaches lockdown and subsequent hotspot restrictions, it clearly showed resilience and optimism among the business community in NSW.

“The positive response from business reinforces the approach the NSW Government has taken in regard to keeping businesses open where it is safe to do so and ensuring that regional areas unaffected by COVID breakouts are not subjected to blanket restrictions,” he said.

“However, there is still a lot of fragility in the business community and the first quarter of this calendar year will be crucial for many businesses as Government support packages are scaled down or wound up.”

Despite overall increases in confidence, 23 per cent of businesses indicated they were at a high risk of failure when supports such as JobKeeper, tax relief, interest waivers and other measures concluded.

“It’s going to be important to identify, target and maintain some government support mechanisms for particular industries and sectors as the recovery has not been equally felt across the entire regional economy,” Mr Hawes said.

“The Hunter region has been somewhat isolated from the economic roller coaster experienced in the border areas, but we are vulnerable to broaer trends when large markets such as Sydney get nervous about travel and spending.”