State increasingly confident as South Australians back themselves and get on with business

South Australians are feeling increasingly confident in the state’s economic recovery and are looking ahead with optimism, according to the latest BankSA State Monitor survey.

The independent survey, conducted in early February, found consumer confidence has increased 9.2 points to reach 124.9 points, marking the fourth consecutive improvement and its highest level in over 10 years.

South Australian businesses are also increasingly confident as activity picks up, increasing 4.3 points to 129.9 points to reach its highest level since 2005.

BankSA State General Manager Business Banking, David Firth, said the results are positive for the state’s economic outlook and indicated that South

Australians are focused on getting on with things, despite the ever-present nature of the COVID-19 pandemic.

“We have seen significant increases in consumer purchasing activity over the past three months, and importantly, consumers are signaling an increased intention to spend in the months ahead. This will continue to impact positively on the psyche of both consumers and local businesses,” said Mr Firth.

Businesses are increasingly confident that the climate for doing business in South Australia will improve over the next 12 months, up 10 per cent, and this is reflected in their mood about their own business situation, which has increased 6 per cent since November. 

The number of businesses that had created additional employment in the past three months also increased 18 per cent since the last survey.

The industries with the highest incidence of creating additional employment over the past three months included construction, transport and regional businesses, in addition to businesses with a larger turnover or employee base.

“We’re seeing the successful local management of the pandemic reflected in businesses’ pride in the state, which has grown nine per cent. For consumers, state pride increased eight per cent since November and by 19 per cent compared to the same time last year – before COVID-19 impacted the state,” said Mr Firth. 

The BankSA State Monitor found South Australians were 17 per cent more confident about how the state had responded to the pandemic compared to November last year, and 18 per cent more confident about the way Australia had responded to COVID-19. However, they were 16 per cent more pessimistic about the way other countries had managed the pandemic. 

“South Australian confidence has been buoyed by our local handling of the pandemic, in spite of ongoing concerns about broader international affairs. There is genuine optimism about our state’s outlook for the future and the economy across a range of sectors,” said Mr Firth.

The most confident business sectors were community services, manufacturing and agriculture, with the largest increases in confidence this survey recorded by the transport, construction and wholesale/retail sectors.

Confidence across both the metropolitan and regional areas of the state has increased.

In regional South Australia, consumer confidence grew by 10 points to reach 126.5 points, and business confidence increased by 6.4 points to 135.2 points.

“Confidence across regional businesses has grown, with owners and operators buoyed by milder and wetter seasonal weather conditions, a focus on spending locally and increased intrastate travel during the holiday period,” said Mr Firth. 

While the majority of indicators across business and consumers were positive across both metropolitan and regional areas, some concern remains for consumers in finding suitable alternative employment if they needed.

Similarly, businesses are somewhat more cautious about making a major purchase in the next 12 months. Intention to take on additional employees in the coming months also reduced after a period of increased hiring in recent months.

“There’s no doubt that there are still some sectors where the ongoing impacts from the pandemic and recovery will be longer, such as tourism, events and performing arts, requiring more targeted support.  

“With the state’s major events season well underway, some of those sectors most affected by COVID-19 – such as performing arts, hospitality, accommodation and entertainment venues – will receive a much-needed boost over coming weeks. 

“South Australia is one of the only places in the world currently where we can gather and support events of this size. South Australians increasingly realise the opportunities we have here despite the pandemic and are getting on with business.”

Image (L-R): Largs Bay transport firm Diamond Bros. Chief Executive, Kym McDermid, with BankSA State General Manager Business Banking, David Firth (credit - Kelly Barnes)