Spending cuts reflect economic worries
The latest “Mint Business Insights With Tony Alexander” survey indicated that “Businesses have grown more concerned about the state of the economy,” which is significantly influencing their plans across several operational areas.
The survey, which aims to capture real-time insights into crucial business aspects like customer flows, pricing, staffing, and expansion strategies, was conducted among subscribers of Tony’s View, reaching out to half of the 31,000 members and receiving responses from 252 varied sector participants.
Economic fears slow down hiring and spending
The survey underscored a noticeable retreat in recruitment activities and capital expenditure among businesses, reflecting heightened economic anxiety. As companies brace for tougher times, there is also a notable absence of investment in enhancing workplace culture, which could become a critical oversight.
“But they do not plan spending more on workplace culture,” Alexander (pictured above) said, which could hint at potential future challenges in employee retention and morale.
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Currency stability amidst monetary policy shifts
Unlike previous cycles of monetary policy tightening, this survey period showed no significant concerns over the New Zealand dollar’s value.
“A notable difference between this monetary policy tightening cycle and those of the past is the absence of a rapid and large appreciation of the NZ dollar,” Alexander said.
This demonstrates how global economic trends, including actions by the US and Australia, are tempering local currency fluctuations.
Shifting priorities in business spending
The survey revealed strategic adjustments in how businesses are allocating their resources.
Key areas seeing an uptick in focus include strategy development, customer retention, and staff training, while recruitment and equipment investments are on the decline. This reallocation suggests businesses are attempting to navigate the current economic landscape by strengthening core areas rather than expanding.
Concerns over rising prices and staff availability
Businesses reported a cautious approach to raising prices, aligning with a broader trend of concern over inflation and its management.
“Thankfully, it looks like the sharp blip upward in the net proportion of businesses planning price rises last month was just a statistical wobble,” Alexander said, indicating a possible stabilisation in pricing strategies.
Additionally, the survey indicated an easing in the challenge of finding qualified staff, likely due to the broader economic slowdown impacting employment levels.
Outlook on revenue and staff morale
Looking forward, businesses are generally pessimistic about revenue prospects in the face of ongoing economic challenges, the survey found.
There is also a growing concern about the impact of current conditions on staff morale and mental health, with many anticipating a decline. This sentiment reflects broader apprehensions about the economic environment and its direct effects on business operations and workforce stability.
To read the “Mint Business Insights with Tony Alexander” report in full, click here.
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