Capital short on high-skill candidates

HAMISH MCNICOL
Last updated 12:32 21/07/2014

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Wellington businesses want to hire more staff but a labour shortage and lack of skilled candidates has dented economic confidence.

However despite a blip in the June quarter, the capital's economy is headed in the right direction, the Wellington Employers' Chamber of Commerce says.

Its latest business confidence survey found 48 per cent of Wellington businesses expected the local economy to improve in the next year.

This was down from 53.7 per cent in March, but substantially higher than May last year, when 18.4 per cent expected the economy to improve.

The survey had seen three consecutive upturns since August 2013, with June's result the first downturn.

Chamber chief executive Raewyn Bleakley said the results showed the Wellington economy remained on an upward path, even as expectations were down slightly. The fact confidence was so much higher than a year ago was a positive in itself, she said.

"With the general election around the corner, a slight downturn was expected, and we tend to see this in election years.

"But basically confidence is holding up well."

Wellington businesses were more confident in the national economy, with 72.2 per cent having a positive outlook of the overall economic picture.

This was also down from March, when 76.2 per cent were confident.

"Our economy is certainly in line with what is happening nationally, where recent surveys show there is a little bit of steam coming out of the pace of growth," Bleakley said.

"Businesses remain mostly confident about the coming 12 months, with plans for spending on staff, plant and equipment holding up."

But Wellington businesses also said employee resource and skill shortages were the biggest limiting factor they currently faced.

This was followed by increased competition, decreasing customers and demand, and the lack of cash flow and government funding for smaller organisations.

Software, electronic and IT staff were said to be the hardest to employ, because of increased competition in the labour market.

The survey's respondents indicated they were likely to hire more staff in the next year.

The 41.7 per cent of businesses that said they would, however, was down slight from the 43 per cent in March.

Businesses were also asked for opinions on the proposed $100 million convention centre and Hilton Hotel, which Bleakley called an exciting proposal.

"But we must make sure the business case stacks up," she said.

About a third of respondents said they would like to see further details before deciding to support it or not.

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"Done properly it has the potential to be a real drawcard for the city and region," Bleakley said.

- Wellington

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