Australian Business Leaders Express Tempered Optimism Amid Persistent Inflation and Uncertainties Ahead, Annual J.P. Morgan Survey Finds

Midsize businesses cited cybersecurity, the competitive environment and weakening consumer confidence as top challenges for the year ahead SYDNEY–(BUSINESS WIRE)–Optimism for the year ahead has climbed among Australian midsize business leaders, with nearly seven-in-ten reporting confidence about the global (69%) and national (68%) economies, up 10% and 9% respectively from 2023, according to J. P. Morgan’s third annual Australia Business Leaders Outlook survey.

With this confidence, growth is top-of-mind for Australian midsize businesses as a majority expect to see an increase in revenues (82%) and profits (78%)—and also plan to boost capital expenditures (73%, up 12% from 2023) and add headcount (56%). Balancing the hopeful outlook on the horizon, 59% reported bracing for a recession in 2024 or believe the economy is already in one, up 13% from 2023. “Australian business leaders are clear-sighted about the challenges ahead, while finding confidence in their resilience and experience navigating uncertain economic environments,” said Elizabeth McAlpine, Head of Commercial Banking Industrials and Consumer Coverage, Australia and New Zealand, J.

P. Morgan. “While they remain focused on driving growth amid a potential recession, it’s clear they expect a soft landing and are feeling hopeful looking to the future.

” The survey of more than 200 C-suite executives found that more Australian midsize companies are looking to expand internationally, while remaining focused on managing the rising costs of doing business. More than half plan to drive business growth through expansion into new distribution channels (54%) and/or new international markets (53%, up 18% from 2023). These plans are in spite of 74% reporting costs continuing to rise due to inflation.

“Even as they contend with economic headwinds, Australia’s business leaders remain cautiously optimistic as we enter 2024 and will continue to focus on harnessing opportunities for growth and international expansion,” said Robert Bedwell, Chief Executive Officer, Australia and New Zealand, J. P. Morgan.

Riding the Waves of Ongoing Challenges Australian business leaders indicated cybersecurity and fraud concerns as the most significant challenge they’re facing, closely followed by high competition and weak consumer confidence. Getting Creative with Financing to Fuel Growth In line with expectations for growth, more than three quarters (77%) of Australian business leaders surveyed expect their credit needs to increase in 2024, up 7% from 2023. While bank lines of credit remain the most common source for financing (66%), the results show an increased reliance on other sources of funding.

Embracing the Possibilities of Artificial Intelligence Australia’s midsize business community is finding ways to leverage the rapid advances in artificial intelligence (AI) tools, such as generative AI and language processing software. For more information on the 2024 Australia Business Leaders Outlook survey, visit jpmorgan. com/business-leaders-outlook-AUS .

Survey Methodology J. P. Morgan’s Australia Business Leaders Outlook survey was conducted online from 16 November – 13 December 2023.

In total, 209 business leaders (CEOs, CFOs, heads of finance and owners) from Australian midsize businesses (annual revenues generally ranging from $20 million to $2 billion AUD) across various industries participated in the survey. Results are within statistical parameters for validity, and the error rate is +/- 6. 6% with a 95% confidence level.

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