The results of the June 2020 Taranaki Business Survey have been released

The results of Venture Taranaki’s latest Business Survey indicate that COVID-19 has translated into a sharp deterioration in economic confidence for the next 12 months. 51.2% of participants indicated they think the national economy will deteriorate, and 39.7% indicated they think Taranaki’s economic outlook will deteriorate.

READ THE FULL SURVEY HERE or WATCH THE WEBINAR HERE

Notably, 79% of respondents indicated they perceive that there is not currently an experience skill shortage. This is the highest confidence in the ease of hiring appropriately skilled staff since December 2016. Almost half of enterprises surveyed do not envision that they will need to make a change to workforce numbers, with an additional 13.8% of enterprises unsure of whether they will be needing to make changes to staffing numbers.
 
“Since our last survey, we are seeing the aspiration of growing staff numbers to become more a goal of retaining staff. Labour availability was the third highest threat factor in November 2019, but now ranks 11th out of 15 in June 2020. This is in line with additional data we have received around enterprises needing to reduce workforce numbers, or no longer having the same perceived levels of growth,” continues Justine.
Undertaken 6-monthly since 1999, the results of this survey are of particular interest, and indicate the current state of business confidence and key business issues in Taranaki during the COVID-19 pandemic. 
 
Sent to more than 1700 enterprises over a cross-section of industries, the survey included the usual questions as well as a section on COVID-19 impacts and learnings. Participants undertook the survey as New Zealand shifted to Alert Level 1.
 
Responses for industry-specific outlook show a mixed bag, with 32.2% indicating they see an improvement in the national economic condition of their industry for the next 12 months, 30.5% indicating they see it as staying the same, and 31% indicating they see it as a deterioration. This level of outlook towards industry deterioration has not been since May 2009.
Respondents felt more positive about their own industry outlook as opposed to the national or regional economic outlook. Respondents identified the greatest deterioration will take place in the national economy compared to their own industry and regional economy.
 
Sales forecasts are less confident for the next six months, with 19% of respondents indicating they think the sales outlook will deteriorate, compared to only 8% of respondents indicating the same during the previous survey 6 months ago.
 
“This is the highest level of sales uncertainty that we have seen since the inception of this survey in 1999,” explains Venture Taranaki Chief Executive Justine Gilliland.
Key business concerns or factors identified as having the largest impact on Taranaki enterprises over the last 6 months were the impact of COVID-19 on business (23%), declining markets (19%), cost of business/materials (11%), price of fuel (10%), and price of electricity (10%).
 
“Interestingly, but not unexpected, there has been a large shift in the identified threat factors since the last survey in November 2019. Previously fuel and energy prices were the most prominent threat, and these now rank as the fourth and fifth highest ranked threat,” Justine explains.
The majority of respondents anticipated employment will hold firm. Compared to the November 2019 survey, there was an increase in confidence in enterprises being about to retain staff, although not increase staffing numbers.  
 
In the COVID-specific section of the survey, 45% of responses indicated they were significantly impacted by COVID-19, but were confident in their ability to recover. 16% of respondents indicated they had not been significantly impacted by COVID-19.
 
The top three areas of business most impacted during the pandemic were revenue slowing or ceasing (64.4%), stress and anxiety (39.4%), and cashflow difficulties (37.5%).
 
Key lessons and experiences that emerged from the COVID-19 lockdown were that remote working or meetings have become more acceptable within an enterprise’s culture, system improvements were fast-tracked to adapt and cope with the change, to be more prepared in the future for change, and a focus on digital and online methods of working/trading.
 
Responding to the question ‘How concerned are enterprises on the ongoing impacts of COVID-19 over the next 3–6 months?’, 43.4% were not sure yet, 28.3% were expecting a negative ongoing impact, and 10.7% were expecting a positive ongoing impact.
 
Of interest, 27.7% of respondents indicated that they think COVID-19 has created new commercial opportunities for enterprises.
 
Since mid-March, Venture Taranaki has conducted 3937 COVID-related interactions with enterprises, and has issued a total of $678,100 in funding across 710 approvals.
 
“We have also issued $117,033 worth of our regular growth and capability funding, bringing the total financial support for Taranaki enterprises to $796,133 since the lockdown and various Alert Levels,” says Justine.
 
“It’s encouraging to see enterprises still pursuing growth and development at this time. And equally, I’m very proud of the team at Venture Taranaki with the work we have been doing to help enterprises during this time.”
 
Venture Taranaki is also leading the economic recovery pillar for the region, as part of a wider regional recovery plan. The economic pillar tactical plan has been created to guide and focus efforts from May 2020 to mid-2023 and integrates Tapuae Roa and Taranaki 2050 Actions, shaped by COVID-19 impacts.