The Canterbury Employers’ Chamber of Commerce (The Canterbury Chamber) has today released the results of its latest Quarterly Canterbury Business Survey (QCBS), highlighting a decline in business confidence and rising uncertainty about inflationary pressure, rising interest rates, and demand.
Chief Executive, Leeann Watson says "The results clearly reflect mounting pressures on Canterbury businesses, with rising costs, high interest rates and the upcoming general election all contributing to uncertainty about the future."
Expectations of the economy weakened, with a large number of the businesses surveyed (41%) expecting a weaker economy over the next 12 months, compared to 27 per cent last quarter.
Expectations about firms’ own financial performance also dropped slightly, although the majority (72%) still expect the same or better earnings over the next 12 months.
"Now that we are so close to the election, these results are a call to action for the next government to immediately address concerns that have featured in our survey for some time now".
65 per cent of businesses highlighted inflationary pressure and rising interest rates as a major concern, up from 47 per cent last quarter. This pressure was particularly felt by sole traders and those within retail, hospitality, accommodation, and tourism businesses.
This quarter also saw a significant jump in the number of businesses concerned about consumer confidence and demand. 42 per cent raised it as a concern for their business, up from 27 per cent last quarter.
"Manufacturers, who make up a significant number of businesses in Canterbury and support the supply chains of the wider economy, have echoed what we are hearing on the ground, that they are starting to worry about forward orders with more than half (53%) raising consumer confidence and demand as a concern for them.
"There must be a focus by the next government on reducing inflation, cutting red tape, and continuing to work on immigration settings which despite some recent improvement, are still not always allowing businesses to access the necessary skills and experience they need.
The survey also highlighted other challenges including mental health and fatigue, with nearly a quarter (23%) of businesses saying it was one of their top three concerns.
"Many businesses have spent the last four years battling with COVID, pivoting, reducing their staffing levels, then trying to get more staff, gearing back up for surging demand, and now they've geared back up and consumer confidence and forward orders are falling again. It's just constant.
"Despite the challenging landscape, there is still trademark Canterbury optimism in the air.
There is a keen interest amongst businesses to explore the potential of artificial intelligence, for example. 62 per cent of respondents are generally positive about the potential impacts of artificial intelligence on their businesses, and 43 per cent plan to investigate or invest in the technology in the near future.
"Businesses are also positive about the strength of Canterbury’s rural base, and the return of tourism which is attracting growing numbers of domestic and international visitors to the region - with spill-over advantages for the wider economy."
The Canterbury Chamber will continue to advocate for an environment that enables businesses to invest in growth and productivity. For more information about what businesses in Canterbury would like to see from the next government, you can read our election year ‘Business Expectations of Government’ report.
For a full copy of the survey results, please visit our website.
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