Businessperformance sentiment at record low

AUCKLAND: Business-performance sentiment is at a record low as a positive postelection glow gives way to a gloomy economic outlook.

The latest twiceyearly BDO Business Wellbeing Index, which included responses from more than 650 business leaders over the past two weeks, shows just 53% feel positive about their business performance, compared with the postelection response of 61%.

Just 41% of business leaders were feeling positive about their finances in the past two weeks, and only 27% feeling positive about economic factors all or most of the time.

Most were feeling challenged by market conditions.

‘‘When we undertook our last survey in the two weeks immediately following the election, business performance sentiment and business leader wellbeing were uplifted,’’ BDO advisory partner Kimberley Symon said.

‘‘This likely reflected a sense of hope and excitement among business leaders about the economic changes that a new government can bring.

‘‘However, there is now potentially a realisation that change will not happen overnight.’’

Ms Symon said the latest report was awash with lowscoring sentiment from business leaders regarding their cash flow (36% feeling positive), political factors (40% feeling positive), financial performance (41% feeling positive) and workload (41% feeling positive).

Rural sector business leaders were more positive on a whole, while the rest were struggling with economic pressures and financial concern.

The survey found agribusiness leaders were feeling more positive about their business performance than they were in October 2023, perhaps led by improving dairy prices.

However, retail and tourism business leaders were considerably less positive about their business performance amid weakening consumer demand and increased costs.

In the six months following the October election, the percentage of leaders saying business financials have been driving negative wellbeing had ballooned to 63% from 49%.

Ms Symon said political factors were still a concern but the May budget might help improve how business leaders were feeling about the environment.

‘‘Business performance is also clearly a standout concern, as well as workload issues. I think our business leaders are feeling really stressed and have a lot on their plate.’’

Business financials remained the leading driver of negative wellbeing, followed by economic pressures — also significantly increasing to 47% from 31% postelection.

She said the report suggested leaders were taking active steps to protect their mental health.

Business leaders were typically more optimistic about their future business performance than their current outlook, with 60% more positive when looking six months ahead, compared with just 53% in the shorterterm.

While economic conditions were a large concern, business leaders were also grappling with new technologies and artificial intelligence.

Just 46% felt positive about the adoption of new technologies, which was one of the lowestscoring business performance attributes and suggested leaders may still be getting their heads around how to effectively leverage AI in their organisations.

However, 55% expected to feel more positive about technology in six months.