Businesses managed to keep overall operating profits steady in 2022-23, despite various economic challenges, according to the latest data released by ABS.
“Operating profit results were mixed at an industry level as many businesses faced the challenge of higher input costs in 2022-23,” said Robert Ewing (pictured above), ABS head of business statistics.
The data provided a detailed view of how businesses responded to economic challenges, including higher input costs, increased demand from higher migration, and a rise in non-discretionary spending due to the end of COVID-19 restrictions.
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“This annual data for 2022-23 adds more detail and nuance to our understanding of how businesses responded to a range of economic challenges,” Ewing said. “This data shows how businesses have performed and that in some cases, businesses were able to pass on higher costs to consumers.”
Industries that benefited and showed operating profit growth included:
The Reserve Bank’s efforts to reduce inflation by raising the cash rate from 0.35% to 4.1% over the 2022-23 financial year led to significant negative revaluations and operating profit declines in the rental, hiring, and real estate services industry, which saw a decline of $45.5bn.
The mining industry experienced the largest growth in operating profit, with an increase of $57.2bn. Shortages in energy commodities in Europe and strong demand in Asian markets through 2022 benefitted coal mining, as well as oil and gas extraction.
“Businesses experienced a mix of conditions including higher input costs, increased demand due to higher migration, and a rise in non-discretionary spending due to the end of COVID-19 restrictions,” Ewing said in a media release.
For more details, see Australian Industry, 2022-23 financial year.
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