Content supplied by ANZ
Finding skilled staff is the No 1 challenge for businesses as they gear up to ride sustained economic tailwinds to success in 2015, according to ANZ’s quarterly Business Micro Scope survey of small firms.
Small business confidence recovered in December to its third highest level in 15 years after two successive quarterly falls, with owners citing a skills shortage as their biggest obstacle.
Wellington reinforced its status as the confidence capital, extending its national lead with a surge to the highest level seen in any region since comparable data was first collected in 2007. Auckland, which accounts for 35 per cent of national GDP, rose to second place for the first time since March 2012 as other regions came off recent highs.
Fred Ohlsson, ANZ’s Managing Director Retail & Business Banking, said: “With recession now four years ago, the economy is well beyond ‘recovery’. Each passing day of sustained growth brings more confidence to reinvest and take on staff.
“However, a lack of skilled staff threatens to hold firms back from reaching their full potential. Migration and training will be key to ensuring businesses can access the skills they need to deliver on the opportunities presented by ongoing economic tailwinds.
“Record confidence in Wellington, along with its strengths in creative and smart industries, mean it could be poised to be the ‘movie star’ economy of 2015. Rising optimism in Auckland also bodes well for the upturn. Sentiment improved across the services, construction, manufacturing and retail sectors, though falling dairy prices have had an impact on agriculture.”
Highlights from the Dec 2014 ANZ Business Micro Scope survey of small firms:
[Net percentages reflect the balance of sentiment – i.e. positive minus negative responses]
• Small business confidence recovered (up 4 points to +24%) after falls in the previous two quarters and is now at its third highest level in 15 years.
• Wellington extended its lead as the most upbeat region (up 6 points to +36%, a record for any region since the data series began in 2007). Auckland (up 6 points to +24%) moved into second place while other regions have come off recent highs.
• Services (up 8 points to +30%) remains the most upbeat sector, with sentiment at its strongest since comparable data was first collected in 2007, followed by Manufacturing (up 2 points to a new high of +25%) and Construction (also up 2 points to +25%).
• Retail posted a strong gain (up 7 points to +19%), while falling dairy prices weighed on Agriculture, the only sector to fall (down 2 points to +5%).
• Lack of skilled staff (cited by one in five) overtook Regulation as the biggest problem facing small businesses. Low turnover was the third most identified challenge.
• Those expecting interest rate rises in the coming year plummeted from +66% to +27%.
42 Comments
No one ever reads anything David... everyone just makes their predetermined opinionated comments...
If anyone ever thought logically about what was best for the individuals already living in NZ we wouldn't have policies flooding the country with migrants based on a "growth is only acheivable via population growth" mentality.
We see the problem most manifestly in Auckland. It is a cycle that has no end and no winners. As the population grows unsustainably we fail to afford to upgrade the infrastructure to sustain normal life for existing residents so the solution is to have more people so that the works happen sooner and there are more people to pay for it, only problem this means more infrastructure needed...
...a never ending cycle in which those who have grandparents or great grandparents born in NZ become the minority while NZ becomes a suburb of Mumbai or Shanghai.
Continuing the failed policy of mass immigration has only made NZ a tougher place for those who were here before this experiment started in the 70s and their families.
The government controls young people's lives through education until at least 17, and then sets them free often only to flounder without a backstop except for an often unhelpful dole cheque. Focussing on guiding and leading young NZers to grow the economy would be a far better focus than more failed mass immigration policies.
The adding of an extra number of immigrants may give an initial boost to business turnover but it finally results indilution of the turnover as these new arrivals enter as new businesses on their own behalf. An example in Howick from one Indian food outlet the numbers rose finally to five and since then two have since closed again.
I suspect that the pressure upward on the NZ dollar is exacerbated by the flood of cash from well capitalised immigrants. One end result could be the exodus of this as quick as it came once our economy softens. Immigrants cash is not nearly as sticky as citizens resources. Add in the funny money from the speculators and we have a potential strain that the banks would be unable to contend with.
Even a simple tour (drive through) the many industrial sections of Auckland (and other main centres) would answer your question and then some. The variety is impressive. You may have been hiding away too long. Industry is booming in New Zealand. We will look back at this time and be impressed. You just have to get out there and look. They aren't going to come to you ...
Sadly I still have a herd to sell off and a farm lease to manage through to until end of season & end of contract so I won't get time to go touring further than Wellington, New Plymouth, Taupo and Napier.... and I know, and through my contacts I know they are all seriously down and seriously struggling.
However the contacts I've got in Hamilton, Auckland, Dunedin, Invercargill, and Christchurch have no good news about shopping, malls, industrial improvement, housing prices and books, consents, rents.
What was commented out was rebranding, companies looking at sidelining or putting back improvements, freebies and giveaways to try and win business. A LOT of business going offshore - not just retail, but also advertising and business quotes, and many brands being rationalised in stores to reduce stocks and head counts. Much of the construction work I'm hearing about is not improvements or expansions.
Christchurch is only replacing what was lost (ie not really growth although it does generate economic activity). Timaru, Dunedin, Invercargill, Queenstown are all pretty much plodding along with not much significant new construction happening.
NB that places like Queenstown might look a hive of activity to those who haven't visited in a few years, but remember a lot of that new construction actually occurred several years ago. Consider the progress at Jack's Point etc. Another example is Pegasus north of ChCh now approaching 10 years since it started and still not a shadow of what was planned...
I sort of dont quite agree. The difference I have seen is I think is the younger ones want a working OE to see the world, find good wages and then never come back (especially if they marry). I will agree that wages in NZ often are worse though, depends if you only go for the $ or consider the lifestyle offsets the wage loss, I did and do.
What lifestyle offsets?
If you live in Auckland...you are going to either spend all of your free time commuting, or working to pay for a house that you don't have to commute as far from.
Oh, the weekends, I forgot. Yeah could spend 4 hours in traffic to the corromandel or up north each way... That's Fun.
Yeah, NZ has a lot to offer, just not in Auckland. May as well live in a properly sorted city like sydney, london, melbourne, singapore etc.
South of france a couple of hours flight away? Sounds better than sitting in a car for 4 hours to an overpriced shack on the beach, but that's just me.
Or you can rent a house in Auckland, walk or cycle to work, take 15 mins to launch your boat and explore one of the best harbours in the world. I often drive to Coromandell..2 hours tops, or Piha 45 mins. Just my opinion but still moving to Wellington end of year (need a sea view).
Not all need coercing steven.
http://www.nbr.co.nz/article/motorheads-targeted-cromwell-innovation-pa…
If a business wants to move out of cities and into the regions, it is free to do so; there is no need for Government intervention.
Some will want to, some won't, and each of them will have their own reasons - the fact that one business has found it worthwhile to make such a move says absolutely nothing about whether others will.
If a business doesn't want to make the move, why and how should Government force it?
The skill pool is smaller and the businesses less specialised which could be a death knell for any career orientated people, also for established corporate business if can take you away from your customer population. So works for remote business (ie tech) if you don't need bandwidth, or for writers. but generally the modern edge is needed.
NZ is just too hostile for most business to emigrate to tougher areas.
haha, a 'technology park' "to create a place where people can work on their vehicles."
"The land and buildings within the site will be used for motorsport and related activities."
I doesn't sound like any industry has moved there yet, rather the developer is hoping to attract more people to work on and live by their vehicles and maybe some companies to " test heavy duty machinery, farming equipment or electronics."
All sounds very speculative at this point in time, but an interesting one to watch. I would love to relocate there, long hot summers, snowboarding in the winter. Just need that high-tech high-pay job...
Unfortuantly it looks like this development is purely focused on petrol heads who want to live and/or work on a race track. I think i will be waiting a wee while longer for that job.
if it can be found .... and also if it is likely to still be around in 5yrs. That's what set me back, when I started moving forward in IT, I took a promotion to replace the guy in Dunners. But that put me last on the list for training and specialisation, so when Australia head office closed the provincial branches as a cost cutting exercise,...
Haha yourself. The motorsport park is serious investment done properly. Like we almost never see in New Zealand. Builder friend is starting a project there for some 'petrol head' who has 42 cars. Deride that if you like, but he will be a serious high net worth individual, who will generate demand for significant skills and services to support what he does.
Exactly KH. dtcarter's reply is so stereotypical of big city snobbery towards the provinces.
Tony Quinn, the developer, has some serious money. He has the European car makers that use the Southern Hemisphere Proving Grounds also avail themselves of his race track and facilities. We are somewhat surprised at the amount of 'high rollers' Highlands Motorsport Park has brought in to Cromwell. Only being approx 30mins from Queenstown International Airport is part of the appeal to those who come here.
Tony and Christina QuinnNet wealth: $350 million
Source: Pet food
http://www.smh.com.au/money/could-you-be-next-20120526-1zbib.html
You seem to be confusing my critique of the 'technology park' with a critique of the track itself. No doubt the track is a great asset to the region and brings in much needed year round visitors outside of the winter and summer tourist peaks. (though the calendar for 2015 is almost empty!)
Having lived in and enjoyed the region for 10 years i wish the endevour every success.
It's great that your builder has additional employment housing the toys of the rich and famous.
However do you really consider it a technology park? How many local technologists are employed by the Euros when they come down from the snowfarm?
Will the much vaunted availabilty of terraced housing above a race garage attract technologists to live there?
How many high-tech companies have relocated their offices to the racetrack? Why are F&P expanding their Dunedin innovation centre and building a new one in Auckland, rather than take this oppourtunity at the racetrack?
This development is focused on petrol heads who want to live and/or work close to racecars. That's doesn't mean it's a bad development.
Im sure there will be special circumstances like very cheap land that make it worthwhile for some businesses to be there, for most however that isnt the case I suggest. My "worry" here is Govn either forcing public depts or bribing businesses to work in rural areas that isnt efficient or effective to otherwise do IMHO. Now if the business sees the sense of it as this example does, good for them. It is a nice town btw, but probably not somewhere I'd live.
When an industry says it seeks 'skills' and therefore migrants, they are telling fibs methinks. If they were truthful, they would say they wanted skills at lower cost. They are happy to leave young New Zealanders on the scrapheap. Workers escaping low wage countries are cheaper fodder.
Generally low margins and high costs and unfavourable employer contracts make it easier for businesses to insist on skills, quals and experience rather than train people. Businesses need to be able manage risk when hiring people, so to make it worth taking chances on people. , and have the margin to pay them entry level wages and do training. Talking to people overseas with huge populations the business have specialist positions but the size often means there's still plenty of entry level stuff.
Um, no 5.4%, unless you have better data?
http://www.tradingeconomics.com/new-zealand/unemployment-rate
However the trend does look promising.
Now if we had 3% yes i'd agree on scraping the barrel, however at 5% ish there is still some slack.
dtcarter: I obviously didn't realise that every street in industrial East Tamaki was building a new version space shuttle. The signs that say "Paper supplies" "Office furniture" "Brake linings" " Industrial power transformets" are all just a cover.
Seriously though the components of our real economy are just mostly mundane. But valuable all the same.
real economies _need_ to be boring to be sustainable. The alternative is planned obselescence, and really now many more features do you need on your iPhone13? How many do you actually use, and how many just because they're there.
That's the danger with the constant commoditisation push. It destroys the basic sustainable wealth invested in businesses. And if you're reinventing the wheel every year then decentralisation will cost to much for the constant upgrades and you will have to centralise...back to the manufacturer in China....
East Tamaki promotes itself as a mundane manufacturing and distribution hub, it doesn't pretend to be a technology and innovation park.
The components of our real economy are many and varied. Xero selling software services is just as important as Rayonier exporting raw logs.
Rayoneir is important. If it's a quality product them questions need to be asked when they become not important.
But Xero, makes money from air (other peoples activities). It's a fourth estate, not primary. much easier to add and develop value, and certainly easier to scale and transport.
Looking forward to Xero kicking out some short range consumer tricks.
intelligent scanning supermarket list? planning, pricing and itemisation/categorisation forensics at the everypersons fingertip, easy enough on yesterdays phones... good market penetration.
data straight to your budget?
"quick pay" app for regular bills with date push reminder?
Heck not too hard to even email a list (app data file) from one person and another and have it flick home.
Want to integrate to your nearest (or favourite store)? get the specials flicked to you? preferentials (like the PaknSav kiosks used to store) push'n'pick on your phone? Too busy, bump it back to the store for their pick staff to handle for you...even get Grenville on the store bike to drop them off if it's worth the convenience...
That there wealth pump be in full swing....! All civilisations have a knack for draining the regions of their wealth (primary and some secondary) whilst enriching the tertiary sectors. Centralisation in whatever form (be it govt, church, fuedal lord) hastens the process via edict.
Think of nature and all it provides as the primary economy. Our capital perhaps?
Take these products via mining, forestry, dairying, water use etc and create a range of products and services. Blue collar jobs mainly. Secondary economy.
Put layers of govt bueracrazy (!), myriad intermediaries many of dubious real value (whose jobs are often the result of increasingly complex legislation removing the possibility of a small business having the skills to deal with them ; try understanding ACC..! ) and just watch those big cities expand. Into this whirlpool come all the wannebee grey shoe brigade. If it moves financialise it. If it doesnt then financialise it till it does. Look at childcare and eldercare for example.; big cash cows with profits pumped to the already wealthy in Auckland.
The transfer from family farming to corporate farming results in increased debt loading and management by wi-fi from Auckland. The conversion of forest land to dairying around Taupo has significantly increased helicopter traffic from Auckland. Ownership and profits to Auckand.
The classic case I observed was the relocation of the Forest Traing organisation LFITB (maybe rebranded now) from Rotorua to Ponsonby. The rationale; more central to the Forest Industry cos much more forestry up north now! Yeah right.
The last time I contacted them there was noboby in the office that knew what a Forwarder was. The only one that did was out - probably having a Latte down road, perhaps even at Stabucks.
Zombie towns, skyrocketing real estate in the cities, inreased intermediary employment and reduced working conditions with immigrant labour; hmm all been done before. But history ha ... who cares cos this time its different.
Employers need to increase staff training for all the usual reasons (productivity is increased, employee confidence is built, job satisfaction, motivation and morale are increased, all reducing employee turnover etc). This needs to apply across all sectors including front-line clerical and reception/secretarial staff where first impressions and often mistakes are made. Unfortunately to many employers are short-sighted, they talk the talk but do little else.
That on the face of it doesnt make sense, are you saying a skilled worker would rather remain un-employed than work for less than they think they are worth? Cant say Ive ever met such a person.
I certainly get offers I refuse as they pay no more or owrse than I am paid right now.
What I do see is little interest in employers training people. In fact they expect you trained up, experienced and cheap.
Ah, yes, I agree. Despite not bothering with agencies I get "tapped" a few times a year but the salary is usually the same, or worse and I decline to proceed.
The problem is genuinely skilled staff are going to be in as high a demand as NZers. Sure off the "boat" they may take a lower paid job just to get in the door but reality wise they are either going to move soon after (say 2 years) if really good or prove not that great and therefore match what they are being paid.
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