Business outlook of services sector firms sinks to 4-year low in January

This hasn’t been seen since the Euro crisis.

More firms in the services sector expect less favourable business conditions in the first half of the year, according to the latest Business Expectations of Services Sector survey by the Department of Statistics.

The survey showed that a net weighted balance of 18% of services firms expect a tougher business climate in the next six months. This is the survey's most negative reading since the first half of 2012, during which a net 25% of firms expected a less favourable business climate.

Only 10% of firms are optimistic about their growth prospect, while a total of 28% of firms foresee a slower business outlook. The majority of firms, or 62%, anticipate the level of business activity to stay the same over the next half-year.

A net weighted balance of 17% of services firms expect operating receipts to decrease. All industries except the financial & insurance and recreation, community & personal services industries hold a negative business revenue outlook.

In terms of employment, a net weighted balance of 4% of firms in the services sector expect to reduce hiring in the first quarter, while a net weighted balance of 14% of firms expect a decline in manpower demand.