BankSA’s State Monitor Survey indicates that business and consumer confidence in regional South Australia may have slipped but country SA's resilience remains undiminished. Regional business confidence, in data collated from the 2nd to the 7th of February, shows business confidence plunged 6.4 points to 110.6 points. Consumer confidence in South Australia’s regions plummeted 10.9 points to 111.0 points since October 2021, however the data shows a two-speed consumer confidence within parts of the state.
Nationwide, the ANZ-Roy Morgan survey on Tuesday indicated that consumer confidence fell over their most recent survey period by 1.4 per cent whereas in South Australia it fell 0.8 per cent. Nationwide interest in buying a major household item fell 2.6 per cent.
At Saturday's state election launch, Labor leader Peter Malinauskas painted a grim picture on unemployment:
"At this election, we are presented with an opportunity not seen since the end of World War II. This is our chance to ensure the legacy of the pandemic isn’t just a bad memory and the worst unemployment rate in the nation."
Yet the Liberal government's take on that week's unemployment data the preceding Thursday was quite different, with Skills Minister David Pisoni saying:
"South Australia’s economy has absorbed the January Omicron wave, holding the unemployment rate to just 4.8 per cent, the state’s 4th best result in the last 12 years.
"Today’s number of employed is also the 4th highest in South Australian history.
Les Ryan, BankSA’s Agribusiness Regional General Manager, reassured that Friday's survey findings do not reflect the overall morale of regional consumers and businesses despite the downturns:
“For businesses, the largest decreases were seen in their confidence to hire in the coming months, concerns about their current business situation, and their perceptions around small business more generally.” “Despite these concerns, all regions had an increase in business confidence around turnover in the past three months.” “The southern region, which includes the South Coast, South East, Hills and Murray Plains was the only region to record an increase in business confidence, largely driven by an increase in state pride and improvement in their own business situation.” “For consumers, it was more of a mixed result from region to region.”
In the state’s North and West, consumers are more upbeat about their financial outlay over the following 12 month period, flexibility with potential job changes and their home situations. In the state’s Southern region, expenditure wasn’t as great amongst consumers who also made fewer major purchases in the past quarter. Conversely, Southern residents were optimistic about their individual monetary circumstances, future job prospects and had an increased impetus to engage with technology.
Mr Ryan said there were various factors dragging short-term confidence down:
“Business and consumer confidence has been impacted by a few key factors, including increased prevalence of COVID cases in the regions, in particularly the recent Omicron wave. “The agricultural sector showed a decrease in confidence, contributed by recent weather events such as the widespread flooding in the north and west of the state that affected livestock, crops and cut transport links. “However there remains an underlying level of optimism, with South Australia’s 2021/22 harvest returning a record-high $3.2 billion Farm Gate Value and crop production well above the 10-year average. Unemployment rates in regional SA have also been lower than Greater Adelaide since August 2021."
The Southern region has overtaken the West and North, which includes Upper Spencer Gulf, Far North and Eyre Peninsula, as the most confident region for business confidence, while the West and North remains the strongest for consumer confidence.
Mr Ryan highlighted one region where confidence is sluggish:
“The Mid North and Riverland - which includes the Barossa, Mid North, Riverland and Yorke Peninsula - remains the least confident in both categories and is sitting around the 100-point benchmark for consumer confidence.”