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Auckland businesses cautious as Budget approaches

Monday 21st May 2012

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Auckland firms fear other businesses are more troubled than they were three months ago, but see their own situations much the same as they were back in February.

The latest Quarterly Business Confidence Survey by Westpac for the Auckland Chamber of Commerce "shows Auckland businesses are continuing to be cautious and confidence in the general business environment has almost halved since February," said the chamber's head, Michael Barnett.

Headline "Auckland business confidence plummets", the statement reported after an electronic survey of "almost 900" businesses last week found a net 12 percent expected improvements in the general business situation over the next six months.

That compared with a net 22 percent positive in February and the result comes three days ahead of the government's promised "zero" Budget, in which little new spending will occur and will all be offset by cuts and revenue grabs elsewhere as the government pushes for a Budget surplus in the year to June 2015.

"However in respect of their own business situation, almost half (48 percent) of respondents predicted an improvement, slightly down from February," Barnett said. Challenging business conditions meant many businesses were looking for further savings rather than investing any profits in the business.

However, jobs are plentiful for skilled workers, with some 22 percent of respondents continuing to find it difficult to employ skilled staff, while most businesses predicted their investment on buildings and machinery would be either the same or less during the next 12 months.

"The results really do reflect businesses are holding onto their money and keeping an eye on global issues."

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