Tony Alexander, BNZ’s chief economist comments on the latest confidence survey completed showing New Zealand business confidence has hit an all-time high and provides comments from various business sectors in New Zealand.
Our monthly survey elicited 763 responses last week and a record net 59% of respondents expect that the NZ economy will be in better shape in a year’s time than it is now. This result is consistent with other less up to date measures showing very positive business sentiment. Some of those other surveys also show high levels of business investment and employment intentions. Our survey does not directly gather such information but instead, we give respondents the opportunity to tell us how things are in their particular sector.
In that regard, the comments have been overwhelmingly positive this month with some key themes being worsening shortages of labor and a still deepening shortage of residential real estate listings.
Recruitment
- Very strong with candidate shortages appearing.
Vehicles/Automotive
- Franchised motor vehicle dealership. Trucking along pretty well, we are having the best start to our pasting financial year for 5 years. We don’t want to get too bullish but are quietly confident.
- Eastern Bay of Plenty Vehicle volumes back to pre ’09 financial years; only smaller units, smaller prices, smaller margins servicing & part volumes good. The outlook for us is great!
- Heavy vehicle servicing industry; we have been busier than ever, and see no reason why this would change for the worst for quite some time
- Motorcycle sales & Service Canterbury mainly farming. I feel there is a slight increase in dairy farming confidence
- Automotive retail. New vehicle sales remain buoyant some erosion of margin, used vehicle sales no growth in volume or margin
Accountancy
- An upward trend in activity underway for many but not widespread enough to say the SME sector is into boom times.
Advertising& Marketing, Media
- Activity is widely seen as picking up.
Agriculture and Agricultural Services
- Dairying is good.
- Servicing slowly picking up but more an attitude of anticipation of higher farmer spending than an actual rise of any great magnitude as yet.
Civil Construction
- Improving with anticipation of labor shortages
Construction
- Busy to getting busy with staff shortages already appearing. Canterbury and Auckland especially strong
Engineering
- Strong activity.
Finance
- Credit demand appears to be picking up but caution still prevails
Hospitality
- Improvement underway
Information Technology/Telecommunications
- The sector appears to be in very good health.
Legal
- Steady to improving activity levels.
Manufacturing
- Mixed comments as usual but with a good smattering of respondents noting improving activity levels. Some worries about the NZD/AUD exchange rate.
Printing and Packaging
- Costs rising, activity slowly edging upward.
Property Development
- More positive comments than for a long time.
Property Management/Investment
Improving activity levels and slowly rising rents
Real Estate – Non-residential
- Signs of improving confidence.
Residential Real Estate
- Evidence of the listings shortage worsening with comments that people are not selling either until they buy or because they fear not being able to find what they want.
- Prices still rising though few actual comments about price movements – more the supply situation. “Each listing gained is a guaranteed paycheck.”
Retail/Wholesale
- Still evident that consumers are seen as keeping wallets reasonably tightly closed.
Tourism and Travel/Accommodation
- Highly variable. Some lift in offshore travel and some operators seeing more foreign visitors but many seeing also no change.
Transport/Logistics and Storage
- Like Printing and Packaging, this sector can give an indication of changing activity levels which may not be evident from other sources.
- Comments are generally positive though in terms of activity slowly improving rather than taking off
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