The return of the Coalition government has provided a significant boost in business confidence, according to Roy Morgan Research.
The Roy Morgan Business Confidence jumped from 102.9 to 114.4 in May – an increase of 11.2% (see graph at bottom).
This is the biggest monthly increase since September 2013, when the Coalition government was first elected.
Interviews conducted after the election reported a higher level of business confidence than those before – 118.4 v 113.5.
The increase in business confidence during May was driven by:
- Large increases in sentiment about business prospects over the next year
- Improving expectations for the Australian economy over the next 12 months
Now, 44.5% of businesses expect their business to be ‘better off’ financially this time next year, while just 15.7% expect the business to be ‘worse off’
“As Roy Morgan has consistently pointed out, a trio of important elections in Victoria, NSW and a national election have provided a great degree of political uncertainty over the past year,” the research house said.
“During this period, business confidence has consistently trended downwards after reaching a recent high of 123.5 in January 2018.”
Despite the gains in business confidence, the index in May 2019 was still 2.3% below the May 2018 reading and 1.1% below its long-term average.