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Worker shortage hurts business confidence

NZ Newswire logoNZ Newswire 5 days ago Rebecca Howard

Businesses are heading into 2018 with less confidence than in 2017 and the tight labour market is the number one headache for employers, a survey by the Employers and Manufacturers Association has found.

Businesses expecting conditions to improve has dropped to 24 per cent from 47 per cent in the prior survey, and those expecting conditions to worsen increased to 28 per cent from 4 per cent over the same period.

However, the number expecting conditions to stay the same has remained relatively steady at 48 per cent compared with 47 per cent in the prior survey.

The annual EMA survey was conducted from October 31 to November 13 and there were 421 respondents.

It reflects sentiment seen in other surveys as respondents are concerned about changing government policy under the new government and a softer housing market, among other factors.

Last week's ANZ Business Outlook survey showed a net 39 per cent of businesses were pessimistic about the year ahead, the lowest level since early 2009, and a decline of 29 points from the previous month.

The tight labour market remains a key issue for employers in the EMA survey, with 72 per cent saying it is difficult or very difficult to recruit staff in skilled position, unchanged from the prior survey.

A total of 65 per cent say there is - or soon will be - a skill shortage in their industry sector.

There has been an increase in the number of employers who seek skilled migrants to 23 per cent in 2017 from 21 per cent in 2016.

Overall, 49 per cent were using the immigration process to recruit staff, compared to 38 per cent in 2016.

New Zealand has been experiencing record levels of net migration with annual net migration rising to 70,700 in the year to October, from 70,300 in the same period a year earlier.

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