Only 31 percent of small business leaders with fewer than 20 employees were more optimistic in the new survey. Photo: 123RF
Big business appears to be navigating the winds of economic change far better than small operators dealing with challenges on a number of fronts.
An annual survey of 700 business decision makers conducted by Perceptive on behalf of 2Degrees indicates overall business optimism was down with small operators the least optimistic, struggling to manage with acute staff shortages amid rising costs.
"Costs are rising across the board, businesses are crying out for skilled staff, and Covid continues to present problems, but large businesses are weathering the storm in a way that smaller businesses aren't," 2degrees chief business officer Andrew Fairgray said.
"The main point is it's just an extremely tight market, which we need to find a resolution to quickly so that New Zealand can rebound and continue growing."
Inflation was sitting at a 32-year high on the back of higher housing, food and fuel costs, driving the consumer price index up by 1.7 percent for the three months ended June, with an annual rate of 7.3 percent.
In addition, the annual rate of unemployment was 3.3 percent in the three months ended June, while wages, as measured by the labour cost index, rose 3.4 percent over the year earlier.
"Kiwi businesses are facing an incredibly challenging environment, but the effects aren't being felt equally," Fairgray said.
The survey indicated just 36 percent of business leaders felt more optimistic about their business compared to a year ago, a drop of four percentage points from 2021, with larger businesses more optimistic.
Only 31 percent of small business leaders with fewer than 20 employees were more optimistic, compared with 43 percent of medium businesses and 57 percent of large businesses.
Medium and large businesses were also more likely to anticipate revenue growth in the next 12 months, and to plan to increase investment in their business in the next year.
"The general view is there isn't enough people in the market for the roles that are available and the time that it's taking to find these people is immensely long," Fairgray said.
"The amount of pressure that's putting on salaries to attract these people means that we're seeing wages increase and also that people are looking for flexible roles with benefits included outside of traditional salaries."
Fairgray said businesses needed relief from the ongoing skills shortages, which was capping productivity and growth. Immigration would be vital for the country's growth, he said.
"We need to look at how we can support New Zealand businesses by improving immigration and getting more workers into New Zealand," he said.
"If we want to support small businesses as they come out of Covid we need to be able to support them with having resources that they can indeed grow their business."