Over 1 in 5 Australian Manufacturers say exchange rate fluctuations affected business performance over the past year—a proportion 36% higher than among Australian business overall, the latest results from the Roy Morgan Business Survey in the 12 months to April 2013 show.
Manufacturers also score well below the norm on Business Confidence, averaging 103 points to 116 for All Businesses.
But the impact of exchange rates clearly varies by just what the business manufactures. Transport Equipment and Machinery manufacturers were affected at a rate more than double the average business, while those in Printing and Metal Products suffered slightly below the average.
Instead, Printers were more concerned about ‘Technology’ compared with other businesses, and Metal Product manufacturers by the ‘Availability of qualified talent or skilled workers’.
However despite the markedly different attitudes across these four manufacturing business types as to which factors impacted performance, they share a negative performance review and outlook, with each scoring under 100 on Business Confidence.
Nigel Smith, Director of Business Research, Roy Morgan Research, says:
“Ford’s decision to close their Australian manufacturing operations is an obvious example of the impact of a consistently high Australian dollar on some sections of the manufacturing industry. However, while manufacturers in general are worried about the exchange rate, not all manufacturers find it as significant as those who make vehicles or vehicle components.
“The issue of biggest concern to manufacturers compared to other Australian businesses is the cost of raw materials, transport and other inputs like energy. Booming export demand for raw materials, and increasing charges associated with the Carbon Tax, must play a part in these concerns.”
Source: Roy Morgan Research Business Survey, May 2012 – April 2013. All Businesses sample, n = 13,632; All Manufacturing, n = 1248; Printing (ANZSIC 16), n = 131; Metal Product Manufacturing (ANZSIC 22), n = 102; Food Product Manufacturing (ANZSIC 11), n = 91; Furniture Manufacturing (ANZSIC 25), n = 135; Clothing & Footwear Manufacturing (ANZSIC 13), n = 60; Transport Equipment Manufacturing (ANZSIC 23), n = 62; Machinery & Equipment Manufacturing (ANZSIC 24), n = 96.
Question: "In the last 12 months, which if any of the following factors have had an influence on the business's performance?" (Exchange Rate Fluctuations); Business Confidence Score constructed from five questions relating current business performance and future expectations.
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