Federal election uncertainty is weighing heavily on the national economic outlook. In the first three months of the year, only 14% of businesses anticipate stronger national growth. Wavering business sentiment is most prevalent metropolitan Melbourne where only one in ten businesses are expecting growth for the economy over the next 12 months. Business confidence in the state economy is also softening. Only one in four businesses anticipate it to grow over 2019, a 13 percentage point decline since this time last year.
Across the economy, domestic demand remained fragile for many businesses during the March quarter. While 36% of respondents reported a rise in sales, this was offset by 24% reporting a decline. More positive is that education, health and community services sectors are leading solid export growth for the state, with over a quarter of Victorian businesses experiencing a rise during the period.
Business confidence in the Australian economy has declined to its lowest point in the past three years. During the March quarter and in the lead up to the Federal election, only 14% of businesses anticipate stronger national economic growth over the next 12 months.
Largely driven by the state’s visitor economy and the education, health and community services sectors, over a quarter of Victorian businesses reported a rise in export activity during the March quarter.
Victoria’s high quality education, health and community services sectors continue to experience strong domestic and international demand.
The Victorian Chamber of Commerce and Industry Survey of Business Trends and Prospects monitors business performance and expectations with respect to current and expected trends in national and state economic conditions. It gauges the recent performance of individual Victorian businesses and their expectations for the next three months. In total, 260 businesses responded to the March quarter 2019 survey.
|Profile of respondents by industry sector||%|
|Building and construction||4.4|
|Wholesale and retail trade||12.3|
|Transport and storage||4.4|
|Business services (e.g. accounting, legal, financial and insurance)||24.1|
|Education, health and community services (e.g. schools, hospitals and nursing homes)||13.6|
|Tourism and recreational services (e.g. hotels, cafes, performing arts providers, hairdressers)||21.5|