The outlook for Australian business investment is fairly weak despite record low interest rates according to the Grant Thornton International Business Report (IBR), a quarterly global survey of 2,580 business leaders.

Just 26% of businesses expect to invest in plant and machinery over the next 12 months, down from 34% in 2013 and 42% in 2012.

Continual investment in the latest physical resources is vital for the long term growth of companies, stated Mauri Mucciacciaro, National Privately Held Business & Wealth Advisory Leader, Grant Thornton Australia.

“This weak inclination of companies to invest may be reflective of fears around the slowdown in China which has led to business leader’s economic optimism dipping for the third quarter in a row.

“Australia experienced positive GDP growth in the first quarter of 2015, which was led by exports but the current outlook for commodities is weak highlighting the need for economic diversification.

“On the other hand the IBR revealed that the percentage of businesses looking to add jobs to their employee base has risen steadily over the past four years, indicating that businesses are choosing to grow through their people. 

“This school of thought is reflected in the number of businesses complaining about the lack of skilled workers available in the marketplace, falling from 59% pre-Global Financial Crisis (GFC) to just 18% today. These complaints could be due to the influx of skilled workers moving to Australia for work as a result of the GFC.

“The whittling view that there is a lack of skilled workers available removes a strong perceived constraint for future business growth.”

“Investment in people and physical resources go hand in hand and one cannot work without the other in relation to long term growth and the ongoing ability of businesses to deliver on their value-add promises to their clients,” said Mr Mucciacciaro.

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For more information please contact:

Karen Kalkaus National Brand & External Communications Co-ordinator, T  +61 7 3222 0343, E karen.kalkaus@au.gt.com

Notes to editors
The Grant Thornton International Business Report (IBR) provides insight into the views and expectations of more than 10,000 businesses per year across 36 economies. This unique survey draws upon 22 years of trend data for most European participants and 11 years for many non-European economies.

Questionnaires are translated into local languages with each participating country having the option to ask a small number of country specific questions in addition to the core questionnaire. Fieldwork is undertaken on a quarterly basis, primarily by telephone. IBR is a survey of both listed and privately held businesses. The data for this release are drawn from interviews with more than 2,500 chief executive officers, managing directors, chairmen or other senior executives from all industry sectors conducted in May 2015.