Wellington firms feeling a bit gloomy

JAMES WEIR
Last updated 07:43 18/02/2013

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Government cutbacks, the cost of earthquake strengthening and rising insurance premiums are making Wellington firms much less up-beat about the city's outlook than the rest of the country.

The survey of about 270 firms was carried out for the Wellington Employers' Chamber of Commerce.

The survey was carried out last month, before last week's announcements that 70 jobs would be cut at NZ Post's Datamail in Petone and that Wellington-based Contact Energy planned to cut 10 per cent of its staff. Contact has 420 staff in central Wellington.

More than 58 per cent of firms surveyed expected the economy to be moderately better, with a small fraction expecting substantially better conditions. More than 11 per cent expected the economy to be worse, with the balance expecting conditions to remain the same.

That translated into 46.7 per cent expecting conditions to improve for the country.

But only 21.7 per cent of firms surveyed expected the Wellington economy to lift in the year ahead.

When asked about their own business, 35.4 per cent expected activity to improve in the year ahead.

The "own activity" measure tended to be the most accurate indicator and while lower than for the national outlook, it still showed a "good percentage" expecting an improvement.

Factors holding businesses back included the difficulty of finding and keeping good staff.

Latest official figures show a national unemployment rate of 6.9 per cent, but the rate was 7.9 per cent in the Wellington region, the highest level since 1994.

Despite that high unemployment rate, 30.5 per cent of businesses said it was harder to find skilled or specialist labour than it was 12 months ago.

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- © Fairfax NZ News

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