WELLINGTON: New Zealand’s small-business owners expect a downhill slide for the economy over the next year. MYOB has released its latest Business Monitor survey of 1000 businesses nationwide.
It shows 51 per cent of small-to-medium business owners expect the economy to decline over the next year and almost a quarter have less work booked for the next three months. The number of businesses expecting their revenue to decline over the next 12 months has doubled to 21 per cent. Another 34 per cent expect it to increase.
MYOB New Zealand general manager James Scollay said the survey showed that while some small-business owners were seeing signs of a slowdown, they were not panicking. “The key point to make is there performance expectations are not falling off the cliff. We are seeing a considerable rise in the number of businesses who expect their own growth to come off current levels but more than a third of SMEs still expect to grow in 2016.”
The survey also shows Christchurch has come to a halt – the number of its businesses reporting growth in the past year has fallen 16 percentage points. Scollay said: “This highlights the difference in the effect of the city’s rebuild now it has reached its predicted plateau. However after coming off previously unseen highs in activity, businesses in the city remain confident of growth, with 38 per cent forecasting their revenue will improve in 2016”.
The results echo the ANZ’s business confidence report, which showed a net 29 per cent of businesses were pessimistic about the general economy, the fifth consecutive monthly decline in optimism, and a six-year low. Activity, profit, investment and employment intentions all dropped.
Scollay said Auckland was the driver of the economy, with 37 per cent of businesses reporting improved revenue over the past year. Retail and hospitality businesses continued to perform well, with 39 per cent reporting revenue growth.
“While we can clearly see some regions are already feeling the effect of the slowdown in the dairy industry, other rural areas like Northland, Bay of Plenty and the Manawatu/Wanganui region are holding up well,” Scollay said. MYOB’s survey showed 9 per cent of businesses planned to hire more full-time staff in the coming year.
