Business conditions survey results for December quarter

Business survey results

The latest results from the Suncorp CCIQ Pulse Survey for the December 2020 quarter marked the third consecutive period of improved business performance and sentiment since the devastating impact of COVID-19 in March 2020. Combined with a period of seasonal improvement, business optimism was chiefly driven by the announcement of a COVID-19 vaccine becoming available in the latter half of the 2021 financial year.

Below is a snapshot of the survey results and you can access the full report here:


Key Findings

  1. The Pulse Business Index (PBI) improved for the next 12 months and across all performance indicators.
  2. More than two-thirds of businesses are now confident in their survival when stimulus support is withdrawn.
  3. More than one-third of businesses reported increasing labour costs, despite employment levels remaining virtually unchanged.
  4. Declining profits remain a challenge for one in three business respondents.




1.  General Business Conditions

General business conditions improved during the December 2020 quarter as businesses and consumers continue to display resilience. For the first time in 2020, the greater majority of businesses (41%) reported a stronger operating environment compared to the opposite. Conditions are forecast to improve in the March 2021 quarter.


2.  Sales and Revenue

The trend of strengthening turnover continued in the December 2020 quarter following the collapse of the index during the March 2020 lockdown. The PBI for sales and revenue gained an additional 3.7 points to 49.6 to reflect successful pre-Christmas trade and community support for small business. Seasonally adjusted data for retail turnover in Queensland supports this growing business sentiment. Not only did consumers spend an additional $1.5 billion in October and November compared to the two months prior, but retail trade was also up 13% on the same period last year. This supports business feedback regarding an observed shift in discretional spending away from interstate or overseas holidaying.


3. Operating Costs

Businesses reported higher operational costs such as rent, electricity and insurance premiums during the December 2020 quarter. The PBI grew by 6.0 points to 60.6 after the absolute majority of businesses reported equal or greater costs (95%). Additionally, regional businesses continue to emphasise issues surrounding mounting insurance premiums amidst more volatile weather events.


4. Labour Costs

Labour costs rose again during the December 2020 quarter as restrictions eased and labour recovery continued. Driven by the growing proportion of business reporting stronger wages (36%), the PBI climbed 7.0 points to 58.6. Like the September 2020 quarter, the updated index reading coincides with improved employment levels and revised JobKeeper payments that commenced on the 28th of September 2020.


5. Profitability

Profitability improved slightly during the December 2020 quarter. The PBI grew by 2.5 points to 40.7, reflecting the first satisfactory result since the September quarter of 2018. Despite recovering in part from the COVID-19 crisis, the latest reading now sits above the 10-year average of consistently low index scores following the March 2009 quarter when the GFC effects peaked. Nearly one-third (30%) of businesses in December reported stronger profitability and compares to observations over the previous decade that have averaged only 19 per cent. The PBI is expected to grow at a similar rate during the March 2021 quarter as nearly two-thirds of Queensland businesses anticipate equal or greater profits. However, with the reality of recovery not expected to be known until stimulus support is removed, it is feared that profitability may have an extended period of underperformance similar to periods following the GFC.


6. Employment Levels

The Pulse Index for employment increased, reflecting seasonal employment and the trend of businesses re-engaging stood down workers. Despite a notable shift in the proportion of businesses reporting weaker or stronger levels, the PBI grew by only 0.9 points to 46.3. Labour force data published by the Australian Bureau of Statistics supports the recovery following an additional 41,500 Queenslanders finding work during the December 2020 quarter; compared to the improvement of 89,900 observed in September 2020. The PBI for employment levels will be challenged by tapering JobKeeper support and difficulties sourcing new employees. Regardless, the March quarter results are forecast to grow an additional 1.6 points to 47.9. This is primarily a reflection of fewer businesses anticipating having to decrease their workforce.


7. Capital Expenditure

The trend of businesses deferring capital expenditure in the wake of the COVID-19 crisis slowed again during the December 2020 quarter. Due to fewer businesses reporting weaker investment, the PBI grew 2.4 points to 46.0. Driving the momentum of business investment has been two key factors. Firstly, due to low inflation and productivity, the Reserve Bank of Australia has cut the cash rate to a new historic low of 0.10 per cent. As a result, the average interest rate for outstanding small business finance has fallen 13 per cent to 4.58% per annum. Businesses also sight a shift in project priorities as they leverage investment incentives and seek to diversify their operations. Business investment is forecast to fall slightly in the March quarter of 2021. This finding is perhaps a reflection of future uncertainty as businesses budget for the year ahead.



The Suncorp-CCIQ Pulse Survey (Pulse Survey) of Business Conditions is the largest survey of the state’s 438,000 small and medium-sized businesses and serves as a leading indicator of sentiment across Queensland’s diverse business community. Pulse is unique and aims to measure the sentiment of business owners and managers across the state, providing critical insights into the current, planned and latent business activity. It is, therefore, a barometer of optimism and concern regarding key matters that are important to Queensland’s small and medium-sized enterprises and provides a platform for their collective voice to be heard.


Further help

If your business is seeing signs of distress, Marsh & Partners are able to help. From accessing government and bank support to analysing and tweaking business operations to ensure your business survives into the future – our business improvement and crisis management experts give hands-on help to better your outcome. You can contact us on (07) 3023 4800 or at

You can find out more about working with Marsh & Partners here. As your Absolute.Account.Ability partner we’re on a mission to make your business life better. We’ll help you set goals for your business, devise an Action Plan to make them happen and meet with you regularly to ensure you stay on track.


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Source: CCIQ Suncorp Pulse Survey of Business Conditions