State economy is strengthening: WA Chamber of Commerce and Industry report
Almost two-thirds of firms believe the WA economy will strengthen over the next 12 months compared with 52 per cent last quarter.
Business confidence in WA has soared to its highest level in seven years, with more firms preparing to employ extra workers and lift production.
The WA Chamber of Commerce and Industry’s quarterly measure of business sentiment, to be released today, shows clear signs the State economy is strengthening, driven by a lift in profits for the mining sector.
Both short and long-term measures of confidence are on the mend. Almost two-thirds of firms believe the WA economy will strengthen over the next 12 months compared with 52 per cent last quarter.
Chamber chief economist Rick Newnham said even over the next few months, far more WA firms were tipping their bottom lines to improve on the back of an improved economic outlook.
“This puts business confidence for the short and long-term back at mid-boom levels — the highest in over seven years,” he said.
“This is a stark difference to just under three years ago when business confidence bottomed out to the same lows experienced during the global financial crisis, confirming that the WA economy has reached a turning point.”
Apart from being more upbeat about the State economy, a third of WA firms reported increasing employment levels over the past three months, with another 49 per cent keeping their payrolls steady.
Production levels are tipped to increase, with more than half of firms expecting to send more out the factory door.
There are also tentative signs of a lift in wage pressures, with a third of businesses tipping a rise in labour costs over the coming three months.
While business confidence edges higher, the Westpac-Melbourne Institute measure of consumer sentiment has fallen for the second consecutive month, with increasing concern among shoppers about the state of the economy.
That is being picked up by the NAB which tracks cashless shopping transactions. They fell 0.6 per cent in April, prompting concerns that the broader measure of retail sales is slipping.