Judging by the results of a special Australian Industry Group (Ai Group) survey released this week on the global economic impact on manufacturing, services and construction businesses, the crisis is set to intensify.
A comment released by Ai Group chief executive, Heather Ridout, on Monday said the survey on the global economic and financial crisis has identified widespread and growing negative impacts across the economy.
“The just-completed survey of businesses in the manufacturing, services and construction industries shows the crisis is biting and that its impacts look set to intensify in the months ahead,” said Ridout in a press release.
The survey is the first in a series Ai Group will conduct over the months ahead to monitor the impacts of the global financial crisis on economic activity and business plans, according to Ridout.
The survey is designed to monitor the impacts both of the crisis itself and of policies put in place to restore consumer spending, investment and business confidence.
According to the survey results, it is “deeply worrying that so many businesses are expressing concern on so many fronts.”
Over 60 per cent of businesses report an overall negative impact of the global crisis on their business, the survey reported.
“The impacts of the global financial crisis are clear in sales levels, with over 60 per cent of respondents reporting a negative impact on their sales. Of these, one-third report a strongly negative impact on sales,” said Ridout.
“This survey, combined with anecdotal evidence from a wide cross-section of sources, confirms that we are in for a rough ride. It suggests very strongly that the malaise has spread to the real economy and that we are yet to feel the full impacts.”
According to Ridout, a recent package introduced by the government aimed at low and middle income households and first home buyers will need to be “monitored very closely over coming months”.
“In response to this monitoring serious consideration may need to be given to additional measures, as well, there will be unpredictable consequences on industry and individual businesses of this downturn which will require flexible and adroit policy responses if investment and jobs are not to be lost,” Ridout said.
According to the report, one-quarter of firms report a strongly negative, and another 36 per cent report a moderately negative overall impact of the global crisis on their business; 13 per cent of firms report a strongly negative impact on current production levels (and 33 per cent a moderately negative impact); and over 60 per cent of companies report negative impacts on sales and one in five companies report being strongly negatively affected.
Contact the Australian Industry Group;
Tony Melville, director
Public Affairs and Government Relations
Australian Industry Group
02 6233 0700