BankSA State Monitor survey highlights recent drop in regional business and consumer confidence

SURVEY: The latest BankSA State Monitor survey showed there was optimism despite a drop in regional business and consumer confidence. Photo: Shutterstock
SURVEY: The latest BankSA State Monitor survey showed there was optimism despite a drop in regional business and consumer confidence. Photo: Shutterstock

Business and consumer confidence in South Australia remains strong despite the recent lockdown yet the level has decreased in regional areas, according to the BankSA State Monitor survey.

The State Monitor, which measures business and consumer confidence, found regional business confidence decreased by 3.3 points to 131.9, with regional consumer confidence decreasing to 119.7 points - a drop of 6.8 points compared with February 2021.

The independent phone survey, conducted in early July with 300 consumers and 300 small business owners and managers, found that just before the lockdown last month business confidence overall in South Australia increased by 4.7 points to 134.6 points.

That total is the highest confidence level across the 24 years of BankSA State Monitor measurements.

Consumer confidence across the state decreased by 3.1 points to 121.8 points, but was still the second highest result since October 2010.

The bank said the State Monitor used a baseline of 100 points, to which the overall survey results were either added or deducted.

A result greater than 100 represents a positive result and below 100 means there were more pessimistic respondents than optimistic.

BankSA agribusiness regional general manager Les Ryan said while July had seen a decrease in regional consumer and business confidence, there remained optimism.

"Combined business confidence across all the regions is still very strong, particularly in the state's West and North region which recorded a 4.5 point increase this survey," he said.

The Southern region - made up of the South Coast, South East, Hills and Murray Plains - had a 4.8 point decrease in business confidence from 135.7 to 130.9, while the Mid North and Riverland region - including the Barossa, Mid North, Riverland and Yorke Peninsula - came in at 128.6 points, a drop of 6.8 points.

All regions recorded a decrease in consumer confidence, with the West and North - which includes the Upper Spencer Gulf, Far North and Eyre Peninsula - having the most significant fall in contrast to business sentiment in this region, with a 20.6 point drop to 102.9.

"Interestingly, there is a significant contrast in the North and West between consumers and businesses, with business confidence in the region now the highest in the state and the only segment to record an increase in confidence," Mr Ryan said.

He said the Southern region remained the most confident for consumers.

It dropped 5.2 points to 124.1, but was the most confident rural region for the seventh consecutive survey.

The Mid North and Riverland region saw a 2.4 point decrease to 123.8 points.

"When we break down the results, regional consumer confidence was lowest around having made a significant major purchase such as a car, white goods or real estate in the past three months, feeling less optimistic about their own household situation, and less confidence in using new technology," Mr Ryan said.

"However, the State Monitor findings showed an improvement in confidence from consumers that they could change to a better job if they had the opportunity.

"Regional businesses were a little more bullish than their consumer counterparts, with a lift in confidence to make a major purchase in the next 12 months and increase in turnover."

Mr Ryan said businesses were more worried about their own business improvement and the prospect of hiring more employees in the near future.