The findings of the latest South Australian Business Chamber — William Buck Survey of Business Expectations make interesting reading in the lead up to the federal election, with business operators speaking out on several key policy issues.

The quarterly survey, now in its 44th year, checked in on confidence and conditions and the issues most impacting business; while also asking what government could do to help, and their views on the best source of energy for South Australia.

No matter the size of the business, or the sector it operates in, the cost of doing business remains by far the most significant issue facing South Australian businesses. 75.1% of respondents named it as one of their top five issues.

The next closest at 54.1% was profitability/profit margins, indicating that while managing cost pressures is an ongoing battle, a drop in revenue is compounding this issue.

A close third at 50.5% was government policies, legislation and compliance which have grown in complexity following the introduction of major federal industrial relations changes. This number has been above 50% for the past three surveys, having been just 39.1% back in September 2023.

South Australian Business Chamber CEO Andrew Kay said that costs continue to increase across the board. ‘Wages, energy, insurance, inputs, there isn’t a cost that hasn’t increased significantly over the past few years,” he said. “The Cost of Materials Index grew to its highest level since September 2023, while the Cost of Overheads Index also increased, marking the ninth consecutive quarter above 150 points.”

“Unfortunately, these costs are not being passed on and the Average Selling Price Index has remained relatively flat over the last 18 months, leading to the reported squeeze on profits,” said Mr. Kay.

Tellingly, when asked what is the one thing that government could do to make it easier to do business, a clear majority of respondents suggestions could be grouped as “reduce tax and red tape”. In the words of one small business operator “Australian business is drowning in unnecessary bureaucratic red tape and interference. Reduce tax. Reduce red and green tape.”

Despite this, business felt a little bit brighter than in the previous quarter survey, with confidence up 7.5 points to 93.8. However, it should be noted that a score of 100% is the baseline, or neutral position, so businesses are still not feeling positive about their future.

Recognising the pressure on power bills, this survey took the pulse of businesses on energy, and it generated a strong response. Mr. Kay said this did not come as a surprise.

“We know from talking with our members, that energy can be quite an emotive subject,” said Mr. Kay. “The Chamber has taken a fuel-source agnostic view – we want energy that is cost effective, sustainable and consistent in its supply, while helping us meet our net zero targets – and we remain open-minded about how that is delivered. It seems that businesses share this approach.”

“With more than 40% of businesses seeing their energy bills grow by 11 – 30% in the past year, it has become a critical part of their cost structure, and their views were clear,” he said.

Solar, nuclear, gas, wind and hydrogen all received the tick of approval from more than 50% of businesses as an energy source. Solar led the way at 79.1% — unsurprisingly as 54.2% of businesses have installed panels – and nuclear energy came in second at 64.0%.

The subject of the moratorium on nuclear energy was also raised, along with concerns or benefits businesses associated with nuclear as a power source.

In the case of repealing the moratorium (66.5%) and the role of nuclear in the South Australian energy mix (65%), the respondents were approximately two thirds in favour.

Businesses saw the benefits of nuclear outweighing their concerns, with dealing with nuclear waste and the initial establishment costs the only two concerns scoring greater than 50%, whereas seven potential benefits including less reliance on other states for power, investment and job creation and revenue for SA, all fared above the halfway mark.

For a full copy of the December 2024 South Australian Business Chamber — William Buck Survey of Business Expectations go to https://sabusinesschamber.com.au/SOBE.

For enquiries regarding this release, contact Andrew Kay,

Chief Executive Officer at the South Australian Business Chamber

akay@sabusinesschamber.com.au / 0439009590