According to Grant Thornton International’s latest International Business Report (IBR) survey, business optimism throughout the country is coming off its high from the last two years; this quarter, 60% of businesses surveyed were optimistic about the country’s economic outlook - this is a sharp dive from 76% last quarter.
Changes to the skilled migrant immigration category made under the previous government and a cooling in migration could be a key factor impacting continued optimism.
The latest IBR has revealed that New Zealand businesses surveyed are becoming increasingly concerned about the availability of skilled workers; 44% cited a lack of availability compared to 36% last quarter and this time last year.
“A booming economy depends on a robust workforce, but there are factors at play that could jeopardise our economic success”, says Paul Kane, Partner, Business Advisory Services at Grant Thornton New Zealand.
“Businesses are doing well and profits are up, but there is a real concern with the ability to hire and retain staff.
“Construction is a good example; the industry is already struggling to find enough qualified builders or people who want to train to become builders. With the success of the Kiwibuild scheme hinging on a workforce ready to deliver what the coalition government has promised, there will need to be some considerations made to achieve this”.
“Businesses also need to keep a close eye on what’s happening overseas, particularly with our biggest trading partners. ASEAN businesses are currently optimistic, but if they see the war of words on trade develop between China and the US, that confidence could start to evaporate.
“Aside from the trade talks, the global economy is firing more strongly than it has in many years. Economic predictions are positive for the short to medium term, but history tells us that growth tends to come in cycles. For businesses across Asia, now represents a window of opportunity to invest in their future,” says Kane.
Paul Kane
Partner, Business Advisory Services
Grant Thornton New Zealand
T +64 9 922 1276
E paul.kane@nz.gt.com