Small businesses are delaying business decisions due to the federal election
A new survey from the Westpac Small Business Report and Deloitte has recorded that job growth and investment could be impacted by Australian small businesses delaying critical business decisions because of the federal election.
According to the report, 50% of small businesses are uncertain about what effect election policies will have on their operations, in turn choosing to delay staffing and investment decisions. This is coming at a delicate moment for the wider economy with growth already slowing and drags from the housing downturn expected to intensify.
The report says that the most profitable businesses are less likely to delay decision making, with 56% stating the election does not affect their timing for hiring staff compared to just 41% of other businesses and 58% of this group do not consider the election when buying equipment.
Westpac banking general manager of SME Ganesh Chandrasekkar says they are seeing many small businesses take proactive rather than reactive approaches to decision making which is encouraging in a time of unpredictability.
“We do appreciate not all businesses will share the same level of confidence, and that is why they’re more cautious and delaying decisions after the federal election. To ensure more small businesses can continue to operate with confidence, Westpac is here to help with an additional $30 billion available to lend to this sector,” he says.
“Our customers tell us that small business tax cuts, less regulation and red tape and energy policy are a top priority in the upcoming election. The recently announced plans to fast track tax cuts for small business will offer some support; but more can be done to help particularly with grant funding,” Ganesh says.
Commenting on business conditions for 2019, Ganesh says, “Looking ahead, the economy is facing a more challenging year with the housing downturn expected to have a more material impact on growth with the RBA now expected to cut interest rates to cushion the slowdown. With the federal election likely to impact business decisions, 2019 is already shaping up as a trickier year for small business; it will be important we work together with government to ensure they are supported and can continue to operate with certainty.”