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Companies in hiring mode | Business confidence surges | Twelve Grains Capital

Businesses are again in expansion mode now that Sydney, Melbourne, Canberra and other parts of the country have emerged from lockdown. Seek reported that the number of job ads posted in October was not only 10.2% higher than the previous month – but was also the biggest month for job ads in Seek’s history.

Meanwhile, the number of payroll jobs in Australia climbed 1.3% in the fortnight to October 16, according to the most recent data from the Australian Bureau of Statistics (ABS). All but three of the 19 industries monitored by the ABS experienced increases in payroll jobs during that period. The biggest job gains occurred in:

  • Accommodation & food services = 5.6%

  • Arts & recreation services = 4.8%

  • Retail trade = 3.0%

  • Construction = 2.3%

  • Transport, postal & warehousing = 2.1%

The Roy Morgan Business Confidence index has enjoyed its biggest jump this year. Business confidence rose from 104.6 points in September to 115.3 points in October, putting it above the long-term average of 113.8 points. Australia has come a long way in the past year. A score of 100 is considered neutral – and, back in October 2020, confidence was in negative territory, at 98.7 points.

Roy Morgan’s survey of more than 1,600 businesses also found:

  • 49.0% expect their business to be better off financially in 12 months, while 14.3% expect it to be worse off

  • 55.0% believe the next 12 months is a good time to invest in growing their business, while 37.5% believe it's a bad time

  • 52.6% expect good times for the Australian economy over the next five years, while 41.5% expect bad times

Australia's small business ombudsman and the states' small business commissioners have called on consumers to spend big with the small business sector over the holiday period. Why? There's four good reasons:

  • Small businesses have endured a disproportionate amount of economic pain during the pandemic

  • They continue to face big challenges, such as staff shortages, supply chain problems and health restrictions

  • Spending money with a small business helps protect that business and its staff

  • It also has flow-on benefits for the broader economy

The ombudsman and commissioners also called on the ATO, landlords, lenders and trade creditors to be sensitive to the debts that small businesses have accrued during the pandemic. According to the ATO, 93% of businesses in Australia have a turnover of less than $2 million.

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