Business performance and confidence in the Hunter have crashed due to the cumulative impacts of coronavirus and bushfires.
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In a report due out on Thursday, Business NSW reports that 53.7 per cent of Newcastle and Lake Macquarie businesses recorded a drop in sales revenue in the March quarter and 51.9 per cent suffered a fall in profit.
The survey, which was conducted in the last two weeks of March, showed almost a quarter of Newcastle businesses had cut staff.
The figures were even worse in the rest of the Hunter, which suffered the largest coronavirus-related revenue drop of any region in NSW.
The Hunter also had the largest cumulative revenue drop, 41 per cent, due to the virus, bushfires and drought.
The least affected regions were Riverina and Murray, at 21 per cent each. Newcastle's cumulative revenue drop was 24 per cent.
Two thirds of Hunter companies lost revenue and profit, and 28 per cent reported a drop in staff numbers.
Hunter Business Chamber chief executive Bob Hawes said the data showed how the bushfires and the virus had combined to wreak havoc on the Hunter economy.
"This reinforces our understanding about the severe indirect impact of the bushfires on our visitor economy, where we saw people staying away in droves from tourist strongholds like the vineyards and Port Stephens due to thick smoke haze or fear of fire," he said.
"These places experienced significant downturn during what would normally be the peak Christmas period and are now facing a bleak Easter with no chance of economic recovery."
The tourism, arts and recreation, accommodation and food industries were affected the most in the quarter.
These places are now facing a bleak Easter with no chance of economic recovery. It's clear that some won't make it through to the other side.
- Bob Hawes
Mr Hawes said the impact of movement restrictions in late March was evident in changing responses from the first week of the survey to the second.
"The survey shows the transition from early-phase impacts relating to supply-chain interruptions and reduced overseas arrivals to the full-scale economic crisis we are now seeing."
Business NSW said conditions had deteriorated rapidly and virus-related revenue losses had doubled between weeks one and two of the survey period.
"Businesses have had to enter hibernation with significant adjustments to staffing levels and capital spending, and it's clear that some won't make it through to the other side," Mr Hawes said.
Business' expectations for the next quarter were at their lowest level since the Global Financial Crisis.
Nearly 90 per cent expected the June quarter to be weaker than March.
Businesses in Newcastle and Lake Macquarie had been less affected than those in the rest of the Hunter but still showed depressed levels of confidence which would be regarded as "catastrophic by normal standards".
Across the state in the March quarter, 67 per cent of businesses reported reduced profit, 61 per cent reported lost sales revenue, 47 per cent said they had cut capital spending and 27 per cent had dropped staffing levels.
Seventy per cent said they would have to stop trading or scale down substantially in the event of sustained social distancing or lockdowns.
"It is also clear that further restrictions on movement and social gathering would be highly detrimental to business, so it is important that the community observes the current rules and regulations, especially over the coming holiday period, so we don't see more limitations imposed," Mr Hawes said.
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