Hutt Valley Chamber of Commerce Quarterly Business Confidence Survey, Sponsored by Bronze Partner, Red Hot Business Coaching & Consulting

Key Findings – September 2024 Business Confidence Survey

Between June and September 2024, businesses in the Hutt Valley reveal mixed sentiments regarding the business outlook. Only a small portion of respondents, 3.7%, feel very confident about their business’s future, while 25.93% are confident. The majority, 48.15%, describe their outlook as OK, indicating a neutral or cautious perspective. On the other hand, a combined 22.22% are either not that confident (11.11%) or not confident at all (11.11%), reflecting significant concerns for some businesses..

Expectations for New Zealand’s business conditions are evolving. In June 2024, many respondents expressed concern about near-term declines, with 34.21% anticipating worsening conditions in the next 3 months and 37.14% in the next 6 months. Looking beyond the immediate future, they had a more optimistic outlook, with 40% of respondents believing that conditions will improve over the next 12 months.

By September 2024, the sentiment shifts notably. The proportion of those expecting deterioration in the next 3 months drops to 26.92%, and 23.07% foresee an upswing. This growing optimism is further reflected in the longer-term outlook, with 40.74% and 66.66% of respondents expecting much or somewhat better conditions in the 6- and 12-month horizons, respectively.

There are shifting expectations for New Zealand’s business conditions over the next 12 months. In June 2024, many respondents anticipated short-term declines, with 50.88% predicting deterioration in the next 3 months and 55.35% in the next 6 months. However, optimism emerges by the 12-month mark, as 41.07% foresee improvement. By September 2024, while 42.31% still expect worsening conditions in the next 3 months, 19.23% anticipate better outcomes. Over the next 6 months, 40.74% expect improved conditions, rising to 70.37% over the next year, indicating increasing confidence in long-term recovery.

In September 2024, businesses anticipate an increase in operating costs over the next six months. Specifically, 11.11% expect costs to be much more expensive, while 48.15% foresee them being somewhat more expensive. Conversely, 40.74% believe costs will remain the same, with no respondents expecting any decrease in expenses. This data indicates a general expectation of rising costs for businesses in the near term.

Businesses who have NO need for new recruitment has increased by over 14% to 84.6% between June 24 and September 24. This is a direct reflection of the current confidence in business as well as their current performance. Whilst the expectation for a need for a recruitment in 12 months’ time is higher than currently at 40.7%, this is 9.3% lower than it was in June 24. There is an ongoing downward trend for the need for staff with a drop of 26% for those businesses who expect to recruit staff in 12 months in 1 year.

Key Findings – June 2024 Business Confidence Survey

Doing business continues to be tougher for many Hutt Valley businesses and they expect these conditions will generally continue until 2025. The outlook for New Zealand’s business conditions has changed notably from March to June 2024. In the next 3 months, pessimism increased slightly (33.89% to 34.21%), with more businesses expecting conditions to remain the same (45.76% to 52.63%). For the next 6 months, optimism rose (33.89% to 37.14%) despite an increase in negative expectations (28.81% to 37.14%). Over the next 12 months, optimism decreased (52.63% to 40.00%), with a higher percentage expecting conditions to worsen (22.81% to 28.57%) and fewer expecting the same (35.09% to 31.43%).

The outlook by Hutt Valley businesses for New Zealand’s general business conditions has become more pessimistic from March to June 2024. In the next 3 months, the percentage expecting worse conditions increased slightly (50.88% to 55.26%), while those expecting the same decreased (42.11% to 36.84%). For the next 6 months, pessimism also rose (55.33% to 61.19%) with fewer expecting the same (26.79% to 14.49%). Over the next 12 months, optimism declined (41.07% to 31.43%), while those expecting worse conditions slightly increased (46.42% to 48.57%) and those expecting the same improved (12.50% to 20.00%).

Between March and June 2024, Hutt Valley businesses have adjusted their views on the cost of doing business over the next 6 months. The percentage expecting much higher costs decreased from 18.33% to 10.53%, while those anticipating somewhat higher costs remained relatively stable (56.67% to 55.26%). Notably, more businesses now expect costs to stay the same (23.33% to 34.21%), and the expectation of somewhat lower costs decreased slightly (1.67% to 0.00%).

Between March and June 2024, Hutt Valley businesses have shown a slight decrease in current issues with filling staff vacancies (30.00% to 29.73%). However, the intention to recruit in the next 12 months has declined more noticeably, from 55.00% to 50.00%. This suggests a nuanced shift: while current recruitment challenges have eased marginally, future hiring intentions have tempered. This could reflect cautious optimism or perhaps adjustments in business strategies amid evolving economic conditions or other factors influencing workforce planning in the region.

Businesses in the Hutt Valley expressed mixed sentiments about the Government’s Budget 2024 impact. While 21.05% felt confident or very confident, a significant 42.11% were either not that confident or not confident at all. This indicates a divided perception, reflecting uncertainty or dissatisfaction with the budget’s implications for local business conditions.

Business Confidence Quick Survey Report – March 2024

The Hutt Valley Chamber of Commerce completed this Business Confidence Survey in March 2024.

The survey was completed with the support of Bronze Partner, Red Hot Business Coaching & Consultancy.

Key Findings – March 2024 Business Confidence Survey

The feedback provided by businesses highlights several key concerns, particularly focusing on the need to depoliticise business operations and improve collaboration between governmental bodies. There is frustration over the blame game between organisations, hindering progress in addressing critical issues such as water infrastructure.
Economic challenges, including rising supplier costs and the need from their customers for greater value for money, are impacting the current situation, alongside uncertainties surrounding international fuel prices and geopolitical influences.
Their concerns extend to a downturn in business, tentative consumer behaviour, and the pressure of a cost-of-living crisis. Furthermore, there’s a call for better support from the government, particularly in stimulating economic activity and addressing issues such as inadequate forward orders, slow response times, and ineffective policies.
Additionally, challenges related to external contracts, competition with Australian labour markets, infrastructure demands, and managing overheads are highlighted.
Overall, the feedback underscores a complex web of economic and regulatory challenges that businesses face, with a clear call for more supportive and efficient governmental interventions to foster growth and stability.

Key Findings – October 2023 Business Confidence Survey

Outlook is optimistic for businesses after the General Election.
There is a mood towards a more optimistic outlook from businesses following the initial results for the General Election 2023. Just over 57% of businesses feel like they are more or somewhat more optimistic since the Election. A further 33% feel their view is unchanged.
Some of the areas that are coming through the comments which reflect this optimism are the potential for change in compliance requirements for businesses.

Businesses see conditions improving for ‘their business’ and ‘New Zealand’ in the next 12 months
There is a view that business conditions for ‘their business’ will start to improve over the next 12 months. Whilst over 60% think conditions for their business will be the same for the next 3 months, the outlook for ‘much or somewhat better’ conditions over the next 6-month to 12-month periods shows a positive trend. In particular the there is a jump of +20% for the 6-month outlook and over 50% for the 12-month outlook. Whilst the outlook for New Zealand is slightly less bouyant, the trend is similar to that for their businesses.

Cost of doing business is still a factor that concerns businesses
The cost of doing business continues to be a factor which concerns businesses in the Hutt Valley. Only 17% think that costs will be somewhat or much less. 43% consider that the cost of doing business will be much more or somewhat more expensive, and 46% say it will be the same. Businesses are concerned also about a reduction in central government spending with views that ‘businesses may be adversely affected by cuts to government expenses’.

The availability of staff will continue to be a challenge. As we have seen in other surveys during 2023 (and in previous years), businesses in the Hutt Valley continue to look for staff. Just under 50% need staff now and over 66% expect to need recruit staff in the next 12 months.
The ongoing feedback we have from businesses is that finding experienced staff continues to be a challenge. Some businesses have been accessing immigration for their staff needs.

Business Confidence Quick Survey Report – July 2023

The Hutt Valley Chamber of Commerce completed this Business Confidence Survey in July 2023.

The survey was completed with the support of Bronze Partner, Red Hot Business Coaching & Consultancy.

Key Findings – July 2023 Business Confidence Survey

The overall picture from this survey is that there is a continuing ‘Cost of doing business crisis’ with over 85% of businesses expecting that the cost of doing business will be ‘Much More or Somewhat More’ expensive over the next 6 months. This is an increase of nearly 7% compared to March 2023 and a 12.5% increase from January 2023.

For the first time in about 2 years, we have seen a slow down in the immediate need for staff with only 38.1% of businesses saying that they are experiencing issues with filling staff vacancies in their business. This is 15.1% change from March 23 when over 50% of businesses were experiencing issues in recruiting staff. We would suggest that this is a direct result of businesses feeling the impact of higher costs and the economic slowdown.

Planning is key for any business and it would appear that planning ahead has been a key activity for Hutt Valley businesses, with 84.2% of businesses having planned and already factored the change in economic situation to their business decisions or have made no change to their approach to their business planning. This indicates that most businesses have been working hard to be ready for this current economic situation.

There are some factors which are a continued trend from previous surveys. These include:

• 9% of businesses indicated that they are you expecting to need to recruit staff in the next 12 months. Whilst this is down slightly from the high experienced in March 2023 (at 68.75%) it does suggest that there is still demand for staff as businesses start to consider the next 12 months.
• There is a continued business sentiment for ‘their business’ in the 3-month and 12-month outlook with businesses expecting that things will be 17.7% and 8.62% ‘Somewhat Better or Much Better’ respectively.

One other area of positive outlook is an overall increase in the business sentiment for ‘New Zealand’ in the 3-month, 6-month, and 12-month outlook with businesses expecting that things will be 5%, 11.8% and 15% ‘Somewhat Better or Much Better’ respectively when compared to March 2023. Most of this sentiment has changed from businesses feeling New Zealand will be ‘Much Worse of Somewhat Worse’.