Rising overheads, staffing costs, and upcoming finance and debt commitments are weighing on Australian businesses, according to new ABS data.
Operating expenses have increased for almost half (46 per cent) of Australia’s businesses over the past four weeks, as new data from the Australian Bureau of Statistics (ABS) highlights ongoing cost pressures across the national business sector.
Published on Tuesday (30 June), the latest Business Conditions and Sentiments release – the final edition in the series – provides a snapshot of business sentiment, drawing on data from approximately 2,700 businesses across a range of industries.
While businesses in fuel-intensive industries were more likely to report higher operating expenses, the proportion citing fuel prices as a driver of those increases fell slightly to 71 per cent in June 2026, from 82 per cent in May 2026.
ABS head of business statistics, Tom Lay, said that although fuel price pressures had eased somewhat, businesses were still reporting higher overall costs.
“The main reasons behind these higher costs included rising business overheads for 65 per cent, staffing related costs for 40 per cent and upcoming finance or debt commitments for 19 per cent of businesses,” he said.
Businesses were asked to gauge the difficulty of meeting financial commitments over the next four weeks, with more than a quarter (28 per cent) describing it as “very difficult”.
Small and medium-sized businesses were more likely to report difficulties meeting financial commitments (both 29 per cent), compared with larger businesses (17 per cent).
The survey also highlighted how businesses have responded to ongoing cost pressures.
Almost half of the businesses surveyed (44 per cent) said they were absorbing cost increases, with 15 per cent increasing prices and 6 per cent introducing a surcharge or levy.
“Businesses in transport, postal and warehousing were the most likely to increase prices in response to fuel prices and availability over the past four weeks, which is then passed onto other suppliers or customers,” Lay said.
“Almost one-third of businesses reported their revenue had fallen, which was most evident with businesses in Information media and telecommunication, wholesale trade, and accommodation and food services.
“Looking forward, around one-third of businesses in Information media and telecommunications, administrative support services, and accommodation and food services all expect revenue to fall in the next four weeks.”
Working solutions
Pressures weighing on Australian businesses have been a recurring theme in recent episodes of The Adviser’s In Focus podcast, with guests signalling the important role brokers can play.
In his appearance, Banjo Loans CEO Guy Callaghan highlighted the challenges facing the SME sector in navigating a multifaceted, multi-speed economy.
“We released our sixth edition of the SME Compass Report earlier this year, where we interviewed over 1,100 SME business owners. They are an optimistic bunch. They are a glass three-quarters full bunch, and they do pretty well,” Callaghan said.
“But 83 per cent of businesses now say there have been business issues that are keeping them up at night. Inflation is the number one, followed by cash flow. (In saying that, 69 per cent hit their revenue targets last year, so nearly 70 per cent!)
“However, confidence for the next 12 months is down. We’ve gone from a high of 83 per cent of businesses being confident about having a good 12 months ahead, to 71 per cent. That’s a really big drop.”
Meanwhile, Capital Bridging Finance CEO and founder Damien Simonfi said economic forces had created a difficult credit landscape for businesses.
“It has been challenging, but it has also been manageable for brokers and borrowers who know where to go. We’ve had three interest rate hikes this year. Inflation’s ticking up. We’re seeing tighter lending standards, and it’s just a more selective approach from the big banks,” he said.
“There are some really mixed signals out there, and that hasn’t helped sentiment. I think people like certainty. But credit is still flowing, especially outside of the majors. As a bridging financier, we’re definitely seeing much higher demand for those short-term solutions and giving the borrowers the breathing space to refinance or to move on to that next project.”
Earlypay CEO James Beeson also commented on the role brokers can play.
“Brokers have an important role in advising business owners who are focused on running their business and may not have the headspace or time to consider other financial aspects that brokers are really good at,” he said.
“But in times like this, where it’s a challenging economic environment, the value that brokers can add is enormous because there’s a lot of stress with many business owners.
“For brokers to come in with experience and a fresh perspective and to be able to guide through this time, it’s a critical role. Just like their accountants and other advisers, brokers are front and centre. It’s an opportunity to think holistically about how they can support their SME clients.”
[Related: Judo lifts provisions as SME loan losses bite]
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