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A comprehensive survey of businesses by Westpac NZ shows leaders who are young, female or Māori are among the most optimistic in the country.
The Grow NZ report, which measures the mood and intent of more than 1200 business leaders across New Zealand, also shows large businesses are twice as likely to want to grow as Small and Medium Enterprises (SMEs), and a desire for work-life balance is testing growth aspirations.
Westpac NZ chief executive David McLean said there had been a shift in sentiment since previous surveys in 2011 and 2015.
“This time, reports of positive growth were higher than ever before, however expectations that business conditions would improve have tapered off. That thinking is consistent with the view of Westpac economists, who believe we are now past the peak of the business cycle.”
Mr McLean noted there were marked variations in the responses of different groups.
40% of women reported business growth in recent years, compared to 32% per cent of men. And, looking to the future, 55% of under 35s expected business conditions to improve, compared to 41% of 35-59 year olds and 34% of those over 60. Māori, Indian and Asian respondents were more confident about the future than those identifying as European.
The survey also revealed a contrast in the expansion plans of different sized businesses.
“Twice as many large businesses are planning to expand than Small and Medium Enterprises. We delved into why that is and found that more SME business leaders than ever before regard maintaining work-life balance as their chief stumbling block,” said Mr McLean.
“47% of SMEs said work-life balance was a barrier to expansion and 22% of them said it was their main barrier.”
Other obstacles to growth, for businesses of all sizes, included a lack of skilled staff, access to funds and increased competition.
Mr McLean said as a nation, New Zealand needed to up its game when it came to supporting businesses that wanted to grow and Westpac was committed to playing a part.
“It would be great to have more small businesses feeling equipped to expand, as we know large businesses employ more people, earn more income and have more consistent growth aspirations.
“We want to help fledgling enterprises spread their wings through our Westpac Business Growth Grants programme, which we launched this month. It offers mentoring, cash and a chance to go on a business retreat in Hawaii, as part of a push to help upcoming Kiwi businesses reach their full potential.”
Asked to rank their expansion options, SMEs indicated an increasing preference towards upskilling staff, while interest in all other forms of expansion dropped off.
Mr McLean said this view reflected what Westpac is seeing at a macro level.
“Difficulty finding labour has emerged as a major constraint on business, with the unemployment rate now at a nine-year low. What we’re seeing in the survey results is that businesses want to hold on to the good people they’ve got and invest in their professional growth.”
A societal move towards flexible working was also evident in the results; nearly four out of five respondents said they offered flexible hours to employees and almost half of those businesses said doing so helps support growth.
The survey also showed there was a significant difference in the way automation is perceived, depending on business size.
“More than half of large businesses expect they’ll automate parts of their operation in the next five years, compared to less than a quarter of smaller enterprises,” Mr McLean said.
Mr McLean said it was evident business leaders were tuned in to the opportunities and obstacles in their industries.
“At Westpac, we’re on a mission to help our customers financially so they can get on with growing a better New Zealand. This research shows the commercial landscape is changing, but businesses are up to the challenges that lie ahead, as they look to carve out their own pathways to growth.”
The nationally representative online survey of 1269 business owners and senior managers was carried out by Nexus Research in February 2018 on behalf of Westpac NZ.