Wellington business confidence continues to improve

Wellington Chamber of Commerce
Media Statement

Monday 3 July 2017

Wellington business confidence continues to improve

Business confidence in the Wellington region's economy continues to improve, according to the latest Wellington Chamber of Commerce Business Confidence Survey, in partnership with Getsmart.

A net 55 per cent of business respondents expect the Wellington economy to improve over the next 12 months, a slight improvement on the net positive 52 per cent in the previous survey in March. The March figure had jumped from 34 per cent in December.

Wellington business confidence in the national economy has also improved, with a net 52 per cent expecting improvement, compared to the net 43 per cent indicated in March. Of respondents, 55 per cent expect the national economy to improve, 42 per cent expect things to remain the same, and 3 per cent are expecting a decline.

The survey was conducted over a two-week period in June.

Businesses have indicated a secure outlook for their own business situations. A net 63 per cent said they expect to see an improvement over the next 12 months – compared to 61 per cent in March and 50 per cent in December.

Businesses continue to expect to see a steady increase in earnings, with a net 61 per cent forecasting an improvement, compared to a net 57 per cent in March and 53 per cent in December, indicating consistency in increased earnings. Of all respondents, 68 per cent expect an improvement while just 7 per cent expect earnings to decline.

The number of businesses expecting to invest more in plant and equipment over the next 12 months has remained consistent – a net 43 per cent compared to 44 per cent in March.

Intentions to hire staff have remained positive and consistent since March. When asked what changes they expect to staffing numbers over the next three months, a net 28 per cent of businesses said they expect to be looking for more staff, slightly down from a net 33 per cent in March.

Finding skilled staff continues to be a challenge for businesses, with a slight improvement from the March survey (5 per cent) to 7 per cent saying it was easier to find skilled staff than it was 12 months ago. Some 48 per cent said it was harder to find skilled staff.

When asked unprompted what barriers were holding back their business, issues around attracting skills staff were again predominant. This is consistent with the Chamber’s surveys over the past year. When asked unprompted what barriers or issues they believed were holding back the Wellington economy, the most common issue cited was transport. This was followed by leadership (both local and national) and housing, as a reported lack of accommodation impacts on the attraction of staff to the region.

Wellington Chamber of Commerce Chief Executive John Milford said the results were encouraging.

“The results are aligned with other recent confidence surveys, and it’s fairly positive, given the time of year in our winter months. It bodes well for business as we head into what is traditionally seen as an upcoming period of uncertainty with an election on the horizon.

“But what’s of real concern for us is that businesses continue to point to finding the right staff with the right skills as their biggest challenge, being up again on the March quarter's survey. Furthermore, 21 per cent of respondents cite, unprompted, issues with staff as being a barrier to business.

"Despite the current political anti-immigration rhetoric, the Wellington region needs immigrants and the skills they bring to help keep the momentum in the local economy. As long as we are short of workers with the right skills then we have no option but to look to immigrants - we certainly can’t afford for our businesses to have uncertainty around access to skills.

"Survey respondents also shared concern that transport continues to be major barrier holding the region back. This response was also unprompted. Nearly two-thirds believe that the "Let’s Get Wellington Moving" consultation process is going too slow, and remain frustrated at the speed of progress.

"We urge local leaders to ensure that post-election progress is made swiftly. We can't afford to stand still in congestion any longer.”

Eds note – Net percentage is the balance of sentiment, positive minus negative responses.

ends

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