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Trends

Post budget gloom for micro businesses

Jenna Hanson
Business and Technology Journalist

Jenna Hanson covers business news and technology for Smarter Business™

Published:
August 14th 2014
Jenna Hanson
Business and Technology Journalist

Jenna Hanson covers business news and technology for Smarter Business™

Published:
August 14th 2014

Published: August 14th 2014

Despite the increasing optimism of small, medium, and large Australian businesses since the May 2014 Budget, Australia's micro businesses are feeling the pressure according to a new report.

The Growth Expectations Index (GEI), released by research firm DBM Consultants, is based on a comprehensive Australian survey of businesses across all sizes and industry sectors.

Small, medium and large business sectors showed an increase in their growth confidence; however this group only represents around one in 10 Australian businesses. For Australia's micro-businesses, those who turnover one million dollars or less, growth confidence had fallen after the release of the Budget.

"The Micro segment represents nearly nine out of 10 of all Australian businesses and employs one in three people. So it is a very important part of the economy. Growth, however, will be driven by larger businesses,” said DBM Consultants, managing director, Dhruba Gupta.

"In February 2014 there was a dip in the growth expectations of the large sector. Luckily, this trend bounced back pretty quickly, but there has been a flow on effect to micro-business and they don't see the future as rosy as all other business sectors."

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The Micro segment represents nearly nine out of 10 of all Australian businesses and employs one in three people. So it is a very important part of the economy.

- Dhruba Gupta, DBM Consultants

Industry breakdown 

Aside from micro-businesses, the index also revealed contrasting industry growth expectations, with confidence in the construction industry falling sharply between March 2014 to June 2014 and the retail industry showing strong confidence.

“The optimism brought by the change of government may have been tempered by manufacturing sector closures, as well as the numerous cutbacks predicted before and during the Federal Budget,” says Gupta.

“Clearly some sectors view these and related developments with concern, while others only see opportunities.”

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