Fed: Small business conditions grow for 2nd quarter in a row

AAP General News (Australia)
08-21-2007
Fed: Small business conditions grow for 2nd quarter in a row

By Colin Brinsden

CANBERRA, Aug 21 AAP - Small business conditions strengthened for a second consecutive
quarter in the three months to June, but skills shortages remain a constraint on investment
planning, a survey released today shows.

The St George-Australian Chamber of Commerce and Industry (ACCI) small business survey
for the June quarter showed employment, wages and non-wage labour costs at their highest
level of growth since the survey began 11 years ago.

It also showed increasing profits, sales and selling prices, as well as increased investment
plans.

"The survey shows very strong small business conditions," ACCI chief executive Peter
Hendy told journalists in Canberra.

The survey's small business conditions index rose to 56.1 in the June quarter, from
54.7 in the previous three months.

An index level of above 50 indicates the conditions are expanding.

For the September quarter, the survey of 1,292 respondents is predicting an index level of 62.6.

Employment grew to 55.1 in the June quarter from 54.7, wages rose to 69.1 from 68.6,
and non-wage labour costs increased to 67.8 from 67.4.

The only component to stand below the 50-mark was profit growth, although this did
increase to 48.9 from 48.3 in the June quarter, and is forecast to spike to 60.9 in the
September quarter.

"Not surprisingly given all that, the survey also when looking at what the major constraints
on further investment planning are, finds that the availability of suitably qualified
employees is the number one constraint on further investment," Mr Hendy said.

"Skills shortages, therefore, across Australia are a huge issue for small business.

"Obviously, I think both sides of politics are aware that their education and training
policies will be very, very important for the future of the business community."

AAP cb/sb/apm/cdh

KEYWORD: SMALL BUSINESS

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