Cost pressures continue to impact businesses

Media Release
Cite
Print
Released
26/05/2022
Source
Business Conditions and Sentiments, May 2022

Over a third (38 per cent) of all businesses expect to increase the price of their goods or services over the next three months by more than usual, a similar result to March 2022, according to data released today by the Australian Bureau of Statistics (ABS).

ABS Head of Industry Statistics, John Shepherd, said: "Most of these businesses were finding that increases in the cost of products and services (92 per cent) and fuel and / or energy costs (78 per cent) were leading factors for planned price increases.”

The survey results also showed nearly half (48 per cent) of all businesses have no plans to increase their prices over the next three months.

“Of these businesses, nearly half (46 per cent) said it was to retain customers and 46 per cent said they had fixed-price contracts in place.” Mr Shepherd said.

Whether businesses expect their prices to increase over the next three months
38% of businesses expect their prices will increase over the next three months Factors contributing to price increases(b)(c) 92% Cost of products or services 78% Cost of fuel and / or energy 50% Other business overheads 38% Staff costs(e) 37% Customer demand 25% Cost of finance (interest rates) 25% Cost of finance (interest rates) 48% of businesses expect their prices will not increase over the next three months Reasons for not increasing prices(b)(d) 46% To retain customers 46% Fixed-price contracts 39% Not practical to change prices e.g. due to advertising 23% Business turnover increasing in line with costs (a) Proportions are of all businesses. (b) Businesses could select more than one response. (c) Proportions are of businesses that expect their prices to increase over the next three months. (d) Proportions are of businesses that expect their prices will remain unchanged or decrease over the next three months. (e) Includes staff wages or salaries, overtime, or other staff related costs.

The results also provided information about planned capital expenditure over the next three months. Almost one in five businesses (18 per cent) have planned capital expenditure in May 2022, consistent with findings in May 2021 (17 per cent).

Nearly half (48 per cent) of businesses planning capital expenditure indicated it would be higher than what is usual for this time of year, fewer than a year ago when 59 per cent planned for higher expenditure. 

The biggest Influencing factors on whether businesses were planning for capital expenditure were uncertainty about the future state of the economy (25 per cent) and supply chain disruptions (23 per cent). 

Data referred to in this release was collected 11 to 18 May.

Further information is included in Business Conditions and Sentiments.

Media notes

  • The data release from the survey provides insights into inflationary pressures of businesses, capital expenditure and finance sought.
  • The additional ABS products published to understand the economic impact of COVID-19 can be found on a dedicated page on the ABS website.
  • When reporting ABS data, the Australian Bureau of Statistics (or the ABS) must be attributed as the source.
  • For media requests and interviews, contact ABS Media at media@abs.gov.au (8.30am-5pm Mon-Fri).
  • Subscribe to our email notification service and get media releases or products sent to you on release.