Hutt Valley business confidence in New Zealand’s economy has declined sharply according to the latest Hutt Valley Chamber of Commerce Business Confidence Survey, sponsored by Red Hot Business Coaching.
Expectations and confidence have decreased significantly this quarter compared to the last survey in June. A net 4% of respondents expected the situation to improve over the next 6 months, compared to net 24% in June and 35% in March.
Overall figures show that 22% of respondents expect the national business situation to improve, 56% expect it to remain the same, and 18% expect it to deteriorate. 4% were unsure.
Hutt Valley business confidence in their own business remained about the same however. A net 41% of business respondents said they expected their own business situation to improve over the next 6 months, compared to net 42% in June and net 56% in March. Of all respondents, 49% expect an improvement, 41% expect things to stay the same and 8% expect a decline in their own situation. 1% were unsure.
The survey was conducted in September over a two-week period.
Expectations around business investment have remained steady. A net 5% of businesses expect to invest more in buildings over the next 12 months, compared to a net 7% in June. Investment in plant and machinery has declined from last quarter but remains positive, with a net 7% of businesses expect to invest in the next 12 months, compared to a net 20% in June.
Business hiring expectations for hiring full-time staff have dropped with a net 12% expecting to hire full-staff in the next three months. However, part-time hiring intentions have improved, with a net 14% expecting to hire part-time staff over the next three months.
According to respondents, the last 3 months have seen positive sales and profitability results. Increased profits were recorded by 26% of respondents, with 48% seeing similar profits to June. Sales in New Zealand were positive over the past 3 months, with 25% of respondents noting an increase in New Zealand sales, and 31% of respondents who exported noting an increase in exports sales.
Lack of finance overtook demand as the prevalent factor limiting business expansion, and respondents highlighted the continuous difficulty in finding skilled employees.
Of respondents, finding skilled staff is still a challenge, but has eased slightly, with 31% saying it was harder to find skilled staff compared to 3 months ago and 4% finding it easier than 3 months ago. This compares with 46% finding it harder, and only 3% finding it easier in June.
Chief Executive of the Hutt Valley Chamber of Commerce, Mark Futter, said “The results show an uncertainty in the lead up to Elections 2017. Expectations for the next few months are confident, and likely reflect the strong results seen before the pre-election hype.”
“Hutt Valley’s diverse business environment is overall fairly stable and feeling economically optimistic.”
“With a stable economic environment and an optimistic outlook comes a greater need for skilled talent. It is a concern that our businesses are still struggling to connect with the skilled staff.”
Note to eds – Net percentage is the balance of sentiment, positive minus negative responses.