Small business trading conditions in Australia continued to worsen amid rising costs, falling profits, subdued consumer demand and global economic uncertainties, a survey released on Monday by the Australian Chamber of Commerce and Industry (ACCI) showed.
The quarterly ACCI Small Business Survey showed a modest dip in conditions from 41.2 index points in the June quarter to 41.1 in the September quarter.
Readings below the break-even level of 50 points indicates small business conditions are continuing to worsen.
The survey also found that the small business sector had become increasingly pessimistic about the strength of the Australian economy over the coming year, with the index of Expected Economic Performance edging lower from 40.6 to 38.8 during the September quarter, to be 2.3 points lower through the year.
The biggest drags for small business were poor profits, driven by falling prices and rising wages.
ACCI Chief Economist Greg Evans said the survey result showed that trading conditions were still challenging for most Australian businesses, with small business reporting conditions as most difficult.
"It is alarming that small business growth indicators, such as sales revenue, profit growth and business investments, are approaching their historic low levels previously recorded during the height of the global financial crisis," Greg Evans said in a statement.
"Small businesses have become increasingly concerned that labor costs have continued to rise and remain elevated, despite all other trading indicators trending lower in recent months."