Business confidence has dropped to levels not seen since before the last federal election, new figures show.
According to the latest Roy Morgan research, February saw business confidence fall to 117.3, down from 131.5 in January, and back to below the level in August (119.6) 2013 in the month prior to the federal election.
This negative result was across all business sizes as well as most states and industries.
According to Norman Morris, spokesperson for Roy Morgan, the results were expected after a number of negative high profile stories during the month.
“These included the federal government decision not to support SPC, the plans by Qantas to reduce their workforce by 5,000, Toyota announcing that it was ceasing car manufacturing in Australia, Alcoa announcing that it was closing several smelters and the Telstra decision to cut employment in its directories division,” he said.
The fall in confidence among business in February was also caused by a decrease in positive feelings about where the economy is heading in the next 12 months and the next five years, the survey showed.
“With nearly 90 per cent of businesses in Australia being classified as micro (annual turnover below $1 million), it is of major concern that they have shown the biggest drop in confidence in February, and as a result are now clearly the least confident business sector," Mr Morris said.
“The lead up to the May Budget will be a critical time for business confidence, as to date the government has been priming business and consumers for a really tough Budget and if negative stories continue until the budget is delivered, confidence could easily fall further in the next few months.”