Small businesses in the construction sector remain confident about their prospects despite the building slowdown and soft economic conditions, the latest survey has found.

In a survey of 1,011 small and medium enterprises (SMEs) across Australia including 140 SMEs in building and construction, Sensis found that 47.1 percent of all construction businesses were either extremely or fairly confident about their prospects over the next twelve months.

This is almost double the 24.3 percent who are either fairly or extremely worried (a further 28.6 percent were neither confident nor worried).

Meanwhile, 43.6 percent of small construction businesses surveyed expect their business to expand in the future – more than three times the 14.3 percent who expect their business to contract.

This comes in spite of challenging conditions in both the broader economy and the construction sector.

According to the Reserve Bank of Australia, the Australian economy is expected to grow by just 1.75 percent this year and by only 2.25 percent in 2020 – an expectation which implies barely any real expansion once population growth (currently 1.6 percent) is factored in.

In construction specifically, residential building approvals have fallen by around a fifth over the past year (admittedly from high levels).

None of this is lost on survey participants.

All up, 85.7 percent of small construction businesses surveyed believe that the Australian economy is either slowing whilst a further 84.3 percent believe the economy will be either worse or the same in a year’s time.

On their own operations, just as many small construction businesses say sales have decreased over the past three months (25 percent) as those who report sales increases (25 percent).

Despite economic challenges, the survey indicates broad optimism across the economy.

Across all sectors, 55 percent of SMEs are confident about their prospects over the next twelve months.

The survey also uncovered dissatisfaction with government policies.

All up, 27.4 percent of all small construction businesses say Federal Government policies are working against small business whilst 20.7 percent say likewise about State/Territory policies.

This compares with only 26.4 percent and 21.4 percent respectively who say that Federal/State policies are supportive of small business.

Speaking about sentiment overall, Sensis chief executive officer John Allan said the high levels of confidence in spite of economic challenges reflects natural optimism among small business owners.

“SMB owners are by nature optimistic,” Allan said.

“We know they have can-do attitudes that give them the drive to tackle a challenge even in the face of trying conditions,”

“It’s this same entrepreneurial spirit that is now shoring up SMB confidence in business prospects despite their growing scepticism in the state of the national economy.”