Startup companies are a lead indicator of business confidence
A business confidence index (BCI) provides information on future developments, based upon opinion surveys on developments in production, orders and stocks of finished goods in the industry sector. It can be used to monitor output growth and to anticipate turning points in economic activity.
Whilst often overlooked, new business registrations are a good indicator of business confidence. Australian company registrations are 20-25% down on 2019, reverting to the same levels as 2012 according to Illion. This means Australian’s are not investing in new business because they don’t have confidence in current market conditions and are uncertain about the future.
The extension of the JobKeeper Payment will help to keep our economy going but the hard reality is businesses will fail and unemployment will be elevated for years to come. The closure of borders along with commercial and public restrictions is suffocating for business, but not knowing when and how this will end is what is killing business.
It’s not a lack of money, jobs or opportunity that destroys an economy. It’s a lack of confidence. With strong commercial confidence and optimism about the future, we can build new businesses and new industries. We can create growth and jobs. Let’s get our confidence back and create a new post COVID economy of growth and optimism. Start a new business, learn a new skill, change jobs, change careers. Now is the time to make a change.