Auckland firms rise in confidence

Confidence among Auckland businesses has improved for the first time in a year, with fewer believing that business conditions are going to get worse, according to a regional business confidence survey.

Some 49 per cent of Auckland businesses are expecting the business environment to get worse over the next six months, down from the 59 per cent who three months ago expected conditions to worsen, according to the Auckland Chamber of Commerce survey.

The improvement is the first since confidence among Auckland businesses began falling in March 2005.

The survey of over a thousand businesses was taken before data last week showed the current account deficit had blown out to 8.9 per cent of gross domestic product and the economy failed to grow in the second half of 2005.

Firms are also more confident about their own prospects, with 40 per cent of businesses expecting their own business will improve over the next six months, up from 35 per cent who expected an improvement three months ago.

"This is not the bad news many might have expected in the face of all the negative talk at the moment," said Chamber of Commerce chief executive Michael Barnett.

"It seems that the fear of the unknown that dominated the talk from the Government and Reserve Bank through last year about forcing up interest rates has been worked through and businesses are taking their own decisions to bounce back."

On the plus side, businesses appear to believe that finding staff might not be so difficult in the coming months. Some 37 per cent believe it will continue to be harder to find employees with the right skills, but this is down from 54 per cent that a year ago believed it would be harder.