The survey also saw an 18.7 percent rise in the Future Conditions Index , as SMEs expressed optimism towards future business conditions , reflected by positive changes in employment ( a net balance of 6.1 percent of SMEs have hired more staff in the last 12 months ) and in investment ( a net balance of 14.4 percent of SMEs have increased investment in the last 12 months ).
SME ’ s perceptions of current and future conditions differ significantly by sector , with SMEs in Hospitality & Recreational Services the most optimistic ( 138.7 ). SMEs in Manufacturing remain pessimistic about current conditions ( Current Conditions Index reading of 77.1 ) but are hopeful about the next quarter ( Future Conditions Index is 108.6 ).
Julie added , “ SMEs contribute a little over half of private sector economic activity and are the fastest growing segment in Australian business . They are the heart of our economy and most importantly , have the scale to help fill the gap created by the reducing business activity of traditional sectors .” SMEs remained concerned about Current Conditions ( at 78.2 ) due to weak activity and declining profits . A net balance of 5.2 percent of SMEs saw a decline in real business activity over the last 12 months and a net balance of 17.2 percent reported a decline in profits over the same period . Westpac Senior Economist , Matthew Hassan said there were a number of contributors to the current results .
“ Some of the positive forward view may reflect the lead-in to the Christmas period , a particularly important high season for many retailers and SMEs in the hospitality sector . Expectations have no doubt been buoyed by recent interest rate cuts as well . The survey detail still suggests current conditions are uneven , while growth is continuing ; incomes remain a weak spot for the Australian economy that is clearly pressuring SMEs ’ profitability . Perhaps the most promising aspect of the survey is the solid rise in employment reported over the last year . It suggests the positive forward view is not just a hope but something small businesses are actively planning for ,” said Matthew . When asked about the role of mentors , surprisingly the survey revealed that over 80 percent of Australian SMEs do not have a business mentor and of those that did , the Health & Aged Care Services industry ranked the highest at 40.6 percent .
Julie concluded , “ When speaking with customers we ’ ve found the top qualities sought after in a mentor are financial advice and expertise followed by strong business acumen . SMEs know what they are after in a mentor ; the challenge is often finding them .
“ Knowing this , we ’ ve set out to help Australian businesses looking to take their business to the next level through our Businesses of Tomorrow program , giving a selection of high performing businesses access to some of Australia ’ s best www . westpac . com . au
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