The latest Chamber of Commerce and Industry Queensland Pulse report found that sales revenue was a key positive and had shown signs of improvement in the September quarter.

“Business feedback revealed that a combination of recovery spend from Covid-19 and increased market demand, especially in the area of tourism, have boosted sales as well as overall business conditions during the September quarter,” CCIQ said in its Pulse report findings.

However, the levels have fallen from the June quarter and were expected to fall further in the December quarter.

The factors that were playing into the loss of confidence among businesses were rising wages and labour costs, continued supply chain delays, rising inflation and increased fuel costs.

But CCIQ said it appeared that labour and operational costs may have peaked because they were showing signs of easing and further marginal improvements were expected in the December quarter.

About 70 per cent of businesses said operating costs had increased and were likely to keep increasing in the December quarter. The struggle to find labour was also a major issue.

“In general, the revenue and cost concerns and their persistence are causing an expectation of weaker economic growth over the next 12 months for both the Queensland and national economies,” the report said.

The report said the Queensland business confidence had decoupled from the real business performance. About 61 per cent of businesses were operating above the levels of March 2020, when Covid-19 restrictions were first imposed in Australia.

“On average, Queensland business was operating at 105 per cent above this level,” the report said.

CCIQ chief executive Heidi Cooper said that the usual sentiment at this time of year was of stronger confidence because of the looming Christmas trading period.

“We are seeing confidence levels in the next 12 months are weaker than this time last year and also below the 10-year average. This is despite satisfactory business performance.”