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Businesses are optimistic about Australia’s recovery from the coronavirus pandemic, with confidence surging across a broad range of sectors. The latest quarterly business survey from NAB Economics shows confidence and conditions across the economy have bounced back from the initial slump caused by the 2020 COVID-induced lockdown.
NAB’s confidence index jumped 22 points to a position of 14, while conditions rose 14 points to an index position of 9 points.
The bank’s chief economist Alan Oster said the positive outlook was spurred on by the easing of severe lockdowns that engulfed the country last year, particularly the nation’s second largest state economy, Victoria.
“What is even more encouraging is the fact that businesses have seen a strong rebound in actual conditions – particularly in trading conditions and profitability,” Mr Oster said.
“This likely reflects the huge support provided to the economy by policy makers.”
Capacity utilisation levels continue to recover and are a measure used by economists to determine the level of output being generated.
“Capacity is our best measure of activity in a levels sense,” Mr Oster said.
“Conditions and confidence suggest that there is a rapid rebound, but capacity utilisation tells us that we are almost back to the same level of output.”
The survey noted businesses were expecting further improvement within the economy over the next 12 months.
NAB executive Andrew Irvine said the report pointed a strong rebound in labour market conditions.
“The highlight is seeing that anticipated employment is strong which means we can expect ongoing recovery in the labour market,” he said.
“It’s clear that Aussie businesses are already leading our road to recovery as they invest and create new opportunities and in turn hire more people.”
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