Figures find the beginning of the rebound
The latest figures released by the Australian Bureau of Statistics (ABS) shows an in increase job vacancies by 0.7 per cent in February, showing a turn around from a previous spate of declines.
The ABS findings come after the Commonwealth Bank (CBA) released findings that show medium sized companies are increasingly looking to expand operations.
The CBA’s Future Business Index found companies are reporting a far more confident outlook for business conditions over the next six months and are reporting strong expectations for increases in revenue.
The bi-annual index of mid-sized companies earning between $10 - $100 million, found that despite patchy results across sectors and states, all companies surveyed reporting a positive increase from the September index.
According to Symon Brewis-Weston, Commonwealth Bank’s Executive General Manager of Corporate Financial Services, the latest findings were a clear sign that confidence was returning to the market.
“We’ve been on wobbly ground for some time, however businesses are showing us that it’s not all doom and gloom and are adopting a much more bullish attitude than has been seen previously,” said Mr Brewis-Weston.
“Appetite for investment is on the way up; the fact that businesses are looking at this over a six month time horizon also shows they have more conviction about the direction they want to take. This shift in attitude comes against the backdrop of continuing change in financial markets and at a time when cost pressures remain relatively high.”
“What this means is they are prepared to look at expansion despite the challenges that are still confronting them. Many mid-market companies have been sitting on sizeable cash reserves for some time and it’s clear they are now re-visiting original investment plans that had been put on hold.”
Almost half (49%) of businesses expect their revenue to increase over the coming six months, with a similar figure (44%) indicating this will flow on to an associated increase in profits. On net balance, both revenue and profit expectations were up 8% since September. Over one-third (38%) said they expected to increase capital expenditure, up 12% on net balance, with roughly one-third (31%) saying they expected to take on new staff over the next six months, up 5% on net balance.