Business mood improves in the capital

Confidence has bounced back among businesses in Wellington, rising from a multi-year low following the change of Government, but still well down on a year ago.

A survey by the Wellington Chamber of Commerce, conducted over a two-week period in March, found a net 7 per cent were confident about the outlook for the New Zealand economy, up from a net 14 per cent which were pessimistic in December.

Wellington businesses were also more upbeat about the capital’s prospects. A net 21 per cent of survey respondents expected the Wellington economy to improve in the next 12 months. This was up from a net 16 per cent positive in December, but down from the net 52 per cent a year ago.

Own trading activity – where respondents are asked about the prospects of their business – rose 3 percentage points to a net 46 per cent positive.

More businesses indicated an intention to hire staff, while more were also positive about profitability than in the December survey.

Investment intentions weakened for the second quarter in a row, but remained positive, with a net 23 per cent expecting to invest more in plant and equipment over the next year.

When asked what barriers the respondents believed was holding back the Wellington economy, the most commonly cited response was the capital’s infrastructure (raised by 44 per cent of respondents), including roading, rail, internet speed and the airport runway. Some 18 per cent of respondents raised local government direction and leadership, while 17 per cent raised central government direction and policy.