Business confidence boosts hiring plans

Employers remain cautious but fewer plan to cut staff amid an improvement in business confidence from recent lows, a quarterly survey, released today, shows.

Employer sentiment improved 0.2 percentage points to a net 19.8 per cent of employers planning to increase permanent staff numbers for the three months ended June, recruitment agency Hudson said.

Sentiment has improved over 31 percentage points from a historic low in March 2009. The official unemployment rate has risen to 7.3 per cent, its highest in more than a decade, but may have peaked earlier than expected, Treasury forecasts show.

"Employers are holding their line this quarter, which is a pleasing sign of stability for the slowly emerging economic recovery," Hudson NZ general manager Marc Burrage said. "Business confidence has remained upbeat throughout the first few months of 2010 and the recent results for GDP in the December quarter of 2009 show the economy is growing, albeit at a slower pace than previous recoveries."

The proportion of employers looking to cut staff fell from the previous quarter's 8.2 per cent to 7.8 per cent. Those planning no change firmed to 64.7 per cent, while the proportion looking to increase permanent staff levels was little changed at 27.6 per cent.

All industries reported positive sentiment for the third consecutive quarter.

Telco employers had the highest levels of optimism, with a net 39 per cent indicating an intention to hire permanent staff in the next three months.

Industry confidence may be due to the central government's commitment to broadband, recently reaffirmed in the national infrastructure plan, Mr Burrage said.

- NZPA