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Help wanted as positive small firms eye expansion

8 July 2016

Help wanted as positive small firms eye expansion

Small business confidence lifted in June, with growth expectations rising to the highest in a year. However, growth could be constrained by a lack of skilled staff, according to ANZ’s quarterly Business Micro Scope survey of small firms.

A net 8% of respondents say they are confident about the business environment, with an increase in firms’ investment intentions and expectations for profit and growth in their own business.

Construction and services are the most upbeat sectors, with Wellington and the South Island outside Canterbury leading the regions.

“Small business owners are telling us they’re confident and ready to put their money where their mouth is by investing to grow their business,” said Andrew Webster, Regional General Manager Retail and Business Banking.

“A net 27% expect to lift activity over the coming year, and this bodes well for economic growth. But the ability to hire capable staff is re-emerging as a handbrake that could constrain further expansion.

“Being able to recruit the skills they need is a key factor influencing whether businesses can meet demand in the market, yet nearly one in five small firms consider finding skilled employees as their main obstacle.

“Migration and training will remain to the fore in maintaining the national talent pool, while firms will more than ever need to build their strategies to attract and keep good staff who can help take their business forward.”
Highlights from the June 2016 ANZ Business Micro Scope survey of small firms:
[Net percentages reflect the balance of sentiment, i.e. percent positive minus percent negative responses]

Small firms’ confidence in the business environment lifted to +8%, from +1% in March.
The composite measure (a growth indicator taking in firms’ own activity, employment, investment and profit expectations) rose 3 points to a one-year high of +13%.
Wellington and the South Island outside Canterbury (both +19%) are the most upbeat regions, followed by Auckland (+16%) and the Rest of the North Island (+11%).
The Services sector (up 7 points to +24%) led the way, followed by Construction (up 5 to +17%). Easing slightly were Manufacturing (down 2 to +16%) and Retail (down 1 to +11%). Agriculture lifted slightly though dairy concerns are still weighing at -13%.
Lack of skilled staff joins Regulation at the top of business owners’ concerns. Each was cited by nearly one in five as their biggest challenge, followed by Low turnover and Competition.

ends

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