Business Conditions and Sentiments

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Insights into Australian business conditions and sentiments.

Reference period
April 2022
Released
28/04/2022

Key statistics

  • Over half (57%) of all businesses experienced increased business costs over the three months to April 2022.
  • Almost half (48%) of these businesses have completely or partially passed on increased costs to customers.
  • One in five businesses (18 per cent) did not have sufficient staff in April 2022.

The April collection was conducted through a telephone based survey between 6 April and 13 April. 

In responding to the survey, businesses are asked to provide a best estimate only, without accessing records or reports.

Business size categories used in this release:

  • Small (0-19 persons employed);
  • Medium (20-199 persons employed); and
  • Large (200 or more persons employed).

For information on survey sample, response rates and the questionnaire, see Methodology.

Cost of doing business

In April 2022, businesses provided information about how business costs had changed over the previous three month period. This is the first time this question has been included in the survey.

Overall, 57% of all businesses experienced an increase in the cost of doing business, with almost a quarter (21%) reporting costs had increased to a great extent.

Medium businesses were more likely than large and small businesses to have increased costs (66% compared with 62% and 56%).

The Accommodation and food services (78%), Manufacturing and Retail trade (both 73%) industries had the greatest proportion of businesses with increased business costs over the past three months.

(a) Proportions are of all businesses.
(b) Includes repair and maintenance, personal (e.g. hairdressers) and other services. 
(c) Increase equals small plus great extent.

Businesses that had increases to the cost of doing business also reported on whether they had passed these costs on to their customers and provided information about other actions they had taken.

Cost of doing business and actions taken

Increased cost of doing business, passing on and actions taken
57% of businesses have had the cost of doing business increase more than usual over the last months (a).
Extent to which increased costs have been passed on (b) - 6% Completely passed on, 42% Partially passed on and 52% Not passed on.
Actions taken due to cost increases(b)(c) - 39% Made changes to business operations or processes, 17% Renegotiated payment terms with customers or suppliers, 16% Deferred or cancelled investment plans and 13% Sought additional funds.

(a) Proportions are of all businesses.
(b) Proportions are of businesses that reported the cost of doing business over the past three months increased to a small or great extent.
(c) Businesses could select more than one response.

Changes in operating expenses

Businesses provided information on how their operating expenses had changed over the last month and expected changes for the next month.

In April 2022, 42% of businesses experienced increases in their operating expenses over the previous month compared to 27% of businesses in April 2021.

When considering the month ahead, 31% of businesses expect operating expenses to increase. The proportion of businesses reporting increases in operating expenses for the past month remains at the highest levels since the survey question was first asked in July 2020.

(a) Proportions are of all businesses.
(b) Businesses reported changes over the last month.
(c) Expectations for the indicated month as reported by businesses in the previous month of collection. 
(d) The Survey of Business Conditions and Sentiments was not conducted between July 2021 to December 2021 (inclusive).  

Changes in revenue

Businesses provided information about changes in revenue over the last month and expected changes over the next month.

In April 2022, 16% of businesses reported that revenue had decreased over the last month. This compares to almost a quarter (24%) of businesses experiencing a decrease in revenue in March 2022 but consistent with April 2021 (18%).

The proportion of businesses reporting an increase in revenue over the past month has risen to 19% compared to 13% of businesses in March 2022.

In responding, businesses were able to provide additional comments. Of those that provided comments, most reported that increased revenue was due to a general increase in business activity. Several businesses also mentioned that seasonal factors contributed to higher revenue.

(a) Proportions are of all businesses.
(b) Businesses reported changes over the last month. 
(c) The Survey of Business Conditions and Sentiments was not conducted between July 2021 to December 2021 (inclusive).  

Staff shortages

Businesses provided information about whether, based on current operations, they had sufficient employees. In April 2022, 18% of employing businesses did not have enough employees.

Medium businesses were more likely than large and small businesses to report staff shortages (34% compared with 31% and 17%).

For businesses with insufficient staff, 84% advised that the inability to find suitable staff was a contributing factor in April, an increase compared to January (69%).  Conversely, the impact of uncertainty due to COVID-19 on staffing levels has decreased in April (36%) compared to January (62%). This coincides with COVID-19 restrictions easing across the country.

(a) Proportions are of employing businesses with an insufficient number of employees.
(b) Businesses could select more than one response.

Supply chain disruptions

A supply chain is a logistics network between a business and its suppliers to produce and distribute a product to the customer. A supply chain disruption is an interruption to that network.

Businesses were asked if they were currently experiencing any supply chain disruptions. This has been collected each month since January 2022, as well as in April 2021.

In April 2022, more than two in five (41%) businesses are experiencing supply chain disruptions. This is consistent with results in March (41%) and February 2022 (37%).  In comparison, 30% of businesses experienced supply chain disruptions in April 2021.

By industry, in April 2022, the Retail trade (84%), Accommodation and food services (67%) and Construction (54%) industries had the highest proportion of businesses experiencing supply chain disruptions.

(a) Proportions are of all businesses.
(b) Top industries in 2022 only.

Businesses with supply chain disruptions provided information about the extent to which they are being affected. In April 2022:

  • 32% were affected to a great extent (e.g., major delays / cannot obtain certain items and significant impact on revenue).
  • 67% were affected to a small extent (e.g., some delays but little impact on revenue); and
  • 1% were not affected at all.

The 41% of businesses that reported current supply chain disruptions provided insights into what was the most significant contributor to these. The following word cloud presents what was reported by these businesses. The more common responses are bigger and bolder.

Main contributors to supply chain disruptions

Main contributors to supply chain disruptions

Main contributors to supply chain disruptions

Theme:
COVID-19 restrictions
Staff illness or isolation due to COVID
Staff shortages
Natural disasters
Global events
Domestic supply chain issues
International supply chain
Logistics or freight challenges
Supply constraints
No alternate suppliers for products 
Increased costs
Domestic and international delivery delays
Multiple issues
Decrease in customers
Government policy

Data downloads

Business Conditions and Sentiments, April 2022

Previous catalogue number

This release previously used catalogue number 5676.0.55.003

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