An annual survey from the Australian Industry Group released today found a low proportion of leaders planning to increase business investment.
The Ai Group’s Business Prospects report surveyed 252 CEOs across manufacturing, construction, services and mining late last-year. According to the Ai Group, the responses showed a pessimism evident “even before this summer’s devastating bushfires.”
More CEOs in this year’s results versus last year’s expected conditions to worsen, there was the worst result since 2015 for businesses expecting revenues, margins and productivity to rise, and “a smaller proportion of businesses plan to increase their spending on capital investment and research & development, compared with the past two years.”
Forty-three per cent expected to lift spending on new technology, 23 per cent planned increased investment in R&D, and 27 per cent planned to increase spending on capex – the lowest “net balance” recorded since 2015 for each of these three categories.
There was at least one positive bit of news for manufacturers cited in the report: “Encouragingly, the outlook is more positive for manufacturing CAPEX with investment plans of manufacturers suggesting an increase in 2019-20 of 4.8% in nominal terms.”
In its statement on the report, the Ai Group recommended continued focus on bushfire recovery, encouraging business investment, and increasing productivity.
The full report can be read here.
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