Con­trac­tor con­fi­dence steady, but cau­tious

New Zealand Logger - - Forest Talk - By: Ge­or­gia Craig and David Evi­son, School of Forestry, Univer­sity of Can­ter­bury

1. In­tro­duc­tion

The lat­est For­est In­dus­try Con­trac­tors’ As­so­ci­a­tion busi­ness con­fi­dence sur­vey was com­pleted in July 2018. 51 log­ging con­trac­tors re­sponded to the sur­vey, pro­vid­ing es­ti­mates of five mea­sures of busi­ness con­fi­dence over the next six months. Our thanks to all those con­trac­tors who took the time to par­tic­i­pate in the sur­vey.

2. Ques­tions and con­trac­tor re­sponses a. Busi­ness con­di­tions

“Do you think con­di­tions for your busi­ness are go­ing to im­prove, stay the same or get worse in the next six months?”

b. Em­ploy­ees

“Are you likely to in­crease, main­tain, or de­crease num­ber of em­ploy­ees over the next six months?”

c. Spend­ing on cap­i­tal equip­ment “Are you likely to be pur­chas­ing new ma­chin­ery or equip­ment over the next six months, no plans to buy any equip­ment, or sell­ing?”

Com­men­tary on the five busi­ness con­fi­dence mea­sures

• Over­all busi­ness con­fi­dence is at the same level as the past 2 sur­veys (in both July and De­cem­ber 2017), with 94% of re­spon­dents ex­pect­ing busi­ness con­di­tions to stay the same or im­prove.

• 92% of re­spon­dents ex­pect to main­tain or in­crease their num­ber of em­ploy­ees over the next 6 months, a 3% in­crease since the last sur­vey. Only 8% of con­trac­tors ex­pect to de­crease their em­ployee num­bers.

• There has been an in­crease in the pro­por­tion of re­spon­dents not pur­chas­ing equip­ment to 25% (from 19% in the De­cem­ber 2017 sur­vey). There has also been a de­crease in re­spon­dents ex­pect­ing to pur­chase ma­chin­ery for ex­pan­sion or sell ma­chin­ery.

• 16% of log­ging con­trac­tors be­lieved they did not re­ceive ad­e­quate in­for­ma­tion and feed­back, and 12% were neu­tral (both up 6% from the pre­vi­ous sur­vey).

• 92% of log­ging con­trac­tors would rec­om­mend the in­dus­try as a good place to work, sim­i­lar to the De­cem­ber 2017 sur­vey.

3. Trends in log­ging con­trac­tor busi­ness con­fi­dence (Jun 2010 to July 2018)

The % net pos­i­tive re­sponse rate pro­vides a sum­mary of busi­ness con­fi­dence for the pe­riod. Trends over time

Con­trac­tors‘ as­sess­ments of over­all ‘busi­ness con­di­tions’ have de­creased by 3% in net pos­i­tive score since the De­cem­ber 2017 sur­vey, due to over half of the re­spon­dents ex­pect­ing con­di­tions to stay the same. There has been a de­crease in net pos­i­tive scores for ‘feed­back from cus­tomers’ (16%) and a very slight de­cline in ‘in­vest­ment’ (2%). Fewer con­trac­tors are ex­pect­ing to buy ma­chin­ery or equip­ment for ex­pan­sion, with more con­trac­tors not ex­pect­ing to pur­chase or sell any­thing in the next 6 months. Ad­di­tion­ally, ‘Rec­om­men­da­tion’ has also seen a slight de­crease go­ing from 90% in the De­cem­ber 2017 sur­vey to 88% for the cur­rent sur­vey.

On the other hand, there has been an in­crease in net pos­i­tive feed­back for ‘em­ploy­ees’, which has in­creased by 2% from the pre­vi­ous sur­vey. 53% of re­spon­dents are ex­pect­ing to main­tain the same num­ber of em­ploy­ees over the next six months with less peo­ple ex­pect­ing to de­crease em­ploy­ees.


Note: the % net pos­i­tive re­sponse is cal­cu­lated as (% of re­spon­dents giv­ing an op­ti­mistic re­sponse, mi­nus the % of re­spon­dents giv­ing a pes­simistic re­sponse).

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