Queensland small business pulse very much alive and kicking
New economic data confirms small business optimism at the start of 2017 with a strong shift in attitude towards the overall economic outlook in Queensland.
The Chamber of Commerce and Industry Queensland (CCIQ) said its new Queensland Economic Update – a monthly snapshot of the local economy – looks promising for the year ahead.
It follows the CCIQ-Suncorp Pulse Survey of Business Conditions released this month which showed small business confidence in Queensland had jumped to its highest level in three years.
CCIQ State Manager of Advocacy Kate Whittle said it was becoming clear that the caution and pessimism of the past two years was lifting in the small business community across Queensland.
“Queensland has entered 2017 with solid momentum, and the small business community is registering a return in optimism and a strong shift in attitude towards the overall economic outlook,” she said.
“While the official unemployment rate has remained static around 6 per cent for the past three months, Queensland continues to deliver nation-leading growth in retail sales, with the state producing solid turnover figures across the critical Christmas sales period.
The February CCIQ Queensland Economic Update – the sixth since its launch in September – follows on the trend from the last quarter of 2016 highlighting business momentum across the state.
The CCIQ Economic Performance Indicator, which measures the overall performance of the Queensland economy relative to the rest of Australia, has also continued to improve, rising by a further 2.3 points.
“While the current unemployment level remains elevated at 6.1 per cent, it has fallen significantly from the most recent high of 6.7 per cent that was recorded in late 2014,” Ms Whittle said.
“The persistent differences in employment opportunities between the South-East corner and Regional Queensland continues as a point of significant concern however, especially with the unemployment rate in North Queensland increasing to a new high.
“Observed increases in the number of job vacancies, combined with recent results from the Pulse Survey, suggest that employment levels could rise in 2017 however, which would begin to address some of the employment issues across Queensland.”
Ms Whittle noted last week’s ABS labour force figures showed the participation rate in Queensland had risen slightly (0.1 per cent trend and 0.3 per cent seasonally adjusted).
“It is possible that the recent rise in participation is a sign that there is a rising confidence among some job seekers that are re-engaging with the labour force and starting a new search for work.
“Despite this, the participation rate across Queensland remains at its lowest levels in a decade, suggesting that the labour market is still weak, with further improvement needed in jobs creation, especially in regional areas.”
Retail trade has recorded three straight months of nation-leading growth, posting an increase of 3.9 per cent in the 12 months to January 1, 2017, with retail businesses reporting strong sales and revenue figures leading into the critical Christmas sales period.
In 2016, Christmas sales increased by 4.2 per cent, with Queensland spending $9.20 billion, and exceeding the original forecast of $9.13 billion made by CCIQ in October 2016.
“This suggests that the industry has a solid platform at the beginning of the New Year, with 2017 expected to be another fascinating year for the retail industry,” Ms Whittle said.
Building approvals for units returned to normal levels in December 2016, with the number of units approved for construction falling to 1132, which is below the 10-year average of 1249.
“While the number of developments currently under construction remains high, the observed fall in the number of new commencements suggests that some difficulties are beginning to emerge in residential construction.”
Ms Whittle said a number of property analysts have highlighted the presale targets for approved unit developments are not being achieved by some developers, with banks and other lenders seeking a higher level of pre-commitment before providing the finance needed to commence construction.
“Overall, the Queensland economy continues to show signs of improvement, and with businesses reporting rising sales and revenue, and the potential for increasing employment, 2017 should provide further momentum as the state continues its recovery.”
Some of the key statistics contained in CCIQ’s Queensland Economic Update include:
• Overall economic performance continues to improve
• Retail sales continue to lead nation in growth
• Economic performance indicator rises by 2.3 points
• 6.1 per cent unemployment rate is 0.3 points higher than the national rate
• Unemployment has remained unchanged for three months
• 29,900 fewer full-time jobs compared with this time last year
• Confidence in the Queensland economy will increase
• Employment levels will rise as business looks to grow
• Profitability to improve on-the-back of rising sales and revenue figures
About the Queensland Economic Update:
CCIQ’s monthly report is crucial reading for the state’s 410,000 small businesses, industry groups, Government departments and politicians at all three levels. It offers an ongoing examination of key indicators, covering labour, finance, construction, retail and demographics, delivering a much needed source of data and information for Queensland businesses.