Despite the ongoing challenges in the labour market, rising prices and supply chain disruptions, an overwhelming 94 per cent of Australia’s business leaders are anticipating growth in the next 12 months.
J.P. Morgan’s inaugural Australia Business Leaders Outlook Survey also reveals that 80 per cent of business owners feel confident that their enterprises will thrive within those 12 months.
“Australian business leaders are finding ways to adapt to the evolving economic landscape, Annabelle Mooney, Head of Commercial Banking for Australia and New Zealand at J.P. Morgan, said. “In spite of headwinds, these midsize companies are primarily optimistic that growth is achievable and are well-positioned to navigate the challenges of today’s uncertain climate.”
The report notes that Australian business leaders have higher expectations in their companies’ growth than their counterparts in the U.S., U.K., Germany and France. They also remain confident in the global and national economy (63 per cent), despite ongoing challenges stemming from the pandemic and the war in Ukraine.
“Despite the business environment appearing uncertain for the foreseeable future, we know the Australian business community is resilient and nimble,” Robert Bedwell, Chief Executive Officer of Australia and New Zealand at J.P. Morgan said. “We continue to see these organisations overcome volatility and keep pushing forward with their expectation of growth on the horizon.”
Despite the optimism, however, 92 per cent of business leaders admitted to feeling the effects of the current labour market as it continues to create obstacles for businesses across the country. As a result of the labour shortage, almost half of current employees (47 per cent) are working more hours, and 44 per cent of midsize businesses are seeing reduced sales/revenue. Their optimistic outlook could, in part, stem from the new Federal government taking office, with 56 per cent expecting the recent election to have a positive impact on their business and just six per cent foreseeing a negative impact, while others remain neutral.
In the hopes of retaining and attracting top talent, Australian business leaders are implementing the following measures:
- increased benefits (50 per cent)
- upskilling or training opportunities (48 per cent)
- flexibility for work location (43 per cent)
- flexible working hours (42 per cent).
With companies being held to a higher standard with regard to environmental, social and governance (ESG) factors, 52 per cent of leaders expect corporate responsibility to be an increased focus area for their business in 2022. Fortunately, 44 per cent of Australian businesses have a positive outlook on the global focus of ESG, because they believe they’re already meeting the requirements. Of the various ESG focus areas, social factors (43 per cent), diversity, equity and inclusion (41 per cent) and environmental factors (37 per cent) were ranked as most important focus areas to their business strategy in the year ahead.
As Australian businesses prepare for the future, 75 per cent are planning or considering a transfer of ownership–with 83 per cent expecting a complete transition within the next five years. For leaders aiming to transition their business, more than half (61 per cent) plan to transfer it to family either through inheritance (28 per cent), sale (26 per cent) or as a gift (seven per cent).
