Ventu ture Taranaki: Results of f th the June 2020 Business Su - - PowerPoint PPT Presentation

Ventu ture Taranaki: Results of f th the June 2020 Business Su Survey

Taranaki Business Survey

• Monitors economic confidence by Taranaki enterprises and their views on

key business issues

• Undertaken by Venture Taranaki 6-monthly since 1999
• Sent to over 1700 enterprises; cross-section of industry type, location, size
• Standard economic questions, plus a special topic: COVID-19 impacts and

learnings

• Timing – undertaken just as the nation shifted to Alert Level 1

ECONOMIC CONDITIONS| NEW ZEALAND

The majority of respondents do not have a positive outlook on the national economy over the next 12 months. Improve – 32.2% Remain the same – 30.5% Deteriorate – 31% Don’t know – 6.3%

29.3% 9.2% 51.2% 10.3% Improve Remain the same Deteriorate Don't know 0% 10% 20% 30% 40% 50% 60%

NZ economic outlook - next 12 months

ECONOMIC CONDITIONS| NEW ZEALAND

Sharp increase in view that economic outlook will deteriorate - 51% of respondents, compared to 22% previously. More uncertainty around the economic outlook than we have seen historically.

0% 10% 20% 30% 40% 50% 60% 70% Nov-07 Apr-08 Sep-08 Feb-09 Jul-09 Dec-09 May-10 Oct-10 Mar-11 Aug-11 Jan-12 Jun-12 Nov-12 Apr-13 Sep-13 Feb-14 Jul-14 Dec-14 May-15 Oct-15 Mar-16 Aug-16 Jan-17 Jun-17 Nov-17 Apr-18 Sep-18 Feb-19 Jul-19 Dec-19 May-20

NZ economic outlook - next 12 months

Improve Remain the Same Deteriorate Don't know

ECONOMIC CONDITIONS| IN INDUSTRY OUTLOOK

Similar to NZ outlook, increasing sentiment towards industry deterioration in the coming 12 months. Improve – 32.2% Remain the same – 30.5% Deteriorate – 31% Don’t know – 6.3%

0% 10% 20% 30% 40% 50% 60% 70% Nov-07 Apr-08 Sep-08 Feb-09 Jul-09 Dec-09 May-10 Oct-10 Mar-11 Aug-11 Jan-12 Jun-12 Nov-12 Apr-13 Sep-13 Feb-14 Jul-14 Dec-14 May-15 Oct-15 Mar-16 Aug-16 Jan-17 Jun-17 Nov-17 Apr-18 Sep-18 Feb-19 Jul-19 Dec-19 May-20

Industry outlook - next 12 months

Improve Remain the Same Deteriorate Don't know

ECONOMIC CONDITIONS| TARANAKI OUTLOOK

Mixed results concerning Taranaki’s economic

• utlook over the next 12

months. Improve – 28.7% Remain the same – 23.6% Deteriorate – 39.7% Don’t know – 8.1%

28.7% 23.6% 39.7% 8.1% Improve Remain the same Deteriorate Don't know 0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Regional outlook - next 12 months

ECONOMIC CONDITIONS| NZ vs IN INDUSTRY

Respondents feel more positive about their own industry outlook as opposed to the national or regional economic outlook. Respondents identify the greatest deterioration will take place in the national economy compared to their

• wn industry and regional

economy.

29.3% 9.2% 51.2% 10.3% 32.2% 30.5% 31.0% 6.3% 28.7% 23.6% 39.7% 8.1%

0% 10% 20% 30% 40% 50% 60%

Improve Remain the Same Deteriorate Don’t Know

Conditions over the next 12 months

New Zealand Own Industry Taranaki

ECONOMIC CONDITIONS| SALES FORECAST

Sales forecast less confident for the next 6 months. Improve – 36% (was 47%) Remain the same – 36% (was 37%) Deteriorate – 19% (was 8%) Don’t know – 9% (was 6%)

0% 10% 20% 30% 40% 50% 60% 70% Nov-07 Mar-08 Jul-08 Nov-08 Mar-09 Jul-09 Nov-09 Mar-10 Jul-10 Nov-10 Mar-11 Jul-11 Nov-11 Mar-12 Jul-12 Nov-12 Mar-13 Jul-13 Nov-13 Mar-14 Jul-14 Nov-14 Mar-15 Jul-15 Nov-15 Mar-16 Jul-16 Nov-16 Mar-17 Jul-17 Nov-17 Mar-18 Jul-18 Nov-18 Mar-19 Jul-19 Nov-19 Mar-20

Sales outlook - next 6 months

Improve Remain the Same Deteriorate Don't know

ECONOMIC CONDITIONS| TARANAKI BUSINESS CONCERNS

Greatest concern: Ongoing/unknown impacts

• f COVID-19 (23%)

Others:

• Declining market
• Costs of business
• Weather

23% 19% 11% 10% 10% 10% 9% 8% 8% 7% 5.95% 2.98% 2% 2% 0%

0% 5% 10% 15% 20% 25%

Factors that have the largest impact on Taranaki enterprises

ECONOMIC CONDITIONS| FACTORS

• “Now focusing more on the local market while the borders are indefinitely closed”
• “International events impacting on overall economy”
• “Impact of COVID border restrictions on ability to travel to execute business”
• “Uncertainty in the industry”
• “Reduced sustainability funding confidence”
• “More concerned that we do not get a repeat of what has been, as economy would be destroyed”
• “Many of our supplying businesses have not adapted well … a lot will be going out of business”
• “Finance options have changed but opportunities to source elsewhere have increased”
• “I am anticipating getting more market share as competitors struggle with post-COVID environment”

Travel/borders

Confidence

New

• pportunities

ECONOMIC CONDIT ITIONS| EMPLOYEE NUMBERS NEXT 6 MONTHS

Majority anticipate holding firm on staff numbers. From the last survey we are seeing an increased confidence in enterprises being able to retain staff, although not increase staffing numbers.

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Nov-07 Apr-08 Sep-08 Feb-09 Jul-09 Dec-09 May-10 Oct-10 Mar-11 Aug-11 Jan-12 Jun-12 Nov-12 Apr-13 Sep-13 Feb-14 Jul-14 Dec-14 May-15 Oct-15 Mar-16 Aug-16 Jan-17 Jun-17 Nov-17 Apr-18 Sep-18 Feb-19 Jul-19 Dec-19 May-20

Employment outlook

Increase Remain the Same Reduce Don't know

ECONOMIC CONDITIONS| SKILLS SHORTAGE OR DIF IFFICULTY HIR IRING?

79% - do not currently experience skill shortages. This is the highest confidence in the ease of hiring appropriately skilled staff since December 2016.

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Nov-07 May-08 Nov-08 May-09 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 Dec-18 Jun-19 Nov-19 Jun-20

Skill shortages

Yes there is a skill shortage No skill shortage

• “People with the right attitude and willing to work”
• “Require skilled staff which takes 2/3 years to attain a commercially viable level”
• “Lack of skilled professional pool in Taranaki”
• “Young staff don’t want to work”
• “We need an extra but will wait until business returns to a little normality”
• “These days it is the young with the skill. But with the skill is not practical experience.

Following that when you employ and train them up, they leave and head elsewhere for newer opportunities”

ECONOMIC CONDITIONS| SKILLS SHORTAGE MENTIONED

SPECIAL TOPIC IC | COVID ID-19 IM IMPACT CTS AND LEARNINGS

SPECIAL TOPIC: COVID-19| PANDEMIC RESPONSE

New Zealand’s handling = 3.95 stars (out of 5) Taranaki’s handling = 3.89 stars (out of 5)

New Zealand’s handling of the COVID-19 pandemic, including decisions this country has made concerning lockdown, information provision and support? Taranaki’s handling and response to the COVID-19 pandemic, including the lockdown phases, information and support?

SPECIAL TOPIC: COVID-19| ENTERPRISE IM IMPACTS

45% - significantly impacted by COVID-19, but were confident in their ability to recover. 16% of respondents not significantly impacted by COVID-19.

44.7% 25.2% 15.7% 8.2% 6.3% 0.0% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Significant setbacks but will recover Some setbacks but back to normal Not significantly impacted Devastated and unsure if will continue Increase in trade and

• pportunities

No longer trading

Impact of COVID-19 on enterprises

SPECIAL TOPIC: COVID-19| AREAS IM IMPACTED

The top three areas of business most impacted: 1. Revenue slowing or ceasing 2. Stress and anxiety 3. Cashflow difficulties

64.4% 39.4% 37.5% 20.0% 20.0% 13.1% 10.6% 10.0% 8.1% 8.1% 8.1% 1.9% 0.6% 0% 10% 20% 30% 40% 50% 60% 70%

Top three areas impacted by the COVID-19 pandemic

SPECIAL TOPIC: COVID-19| REMOTE WORKING

48% of Taranaki enterprises surveyed shifted to remote/virtual working during Alert Levels 4 and 3. 41% of enterprises surveyed did not shift to remote/virtual working.

47.8% 40.9% 11.3% Yes No Other 0% 10% 20% 30% 40% 50% 60%

Percentage of enterprises that shifted to working remotely/virtually (all or in part), during Levels 4 and/or 3

SPECIAL TOPIC: COVID ID-19| IN INFRASTRUCTURE ADAPTABILITY

39% of enterprises reported the transition to remote working had a low impact given their infrastructure. Those that answered ‘other’ had only part of their enterprise working remotely, and the other already had flexible work practices in place.

39.1% 16.5% 8.3% 1.5% 34.6% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Low impact Moderate impact High impact Other Not applicable given the nature

• f work

How did enterprises infrastructure adapt to remote / virtual working

When asked how their enterprise’s organisation culture adapted to the change of virtual/remote working, the following responses were received:

• “Badly, very time consuming for little reward”
• “No change, the external social aspect however was affected”
• “Really well. Created excellent communication streams, which I think helped with team moral”
• “We adapted quickly and made sure we scheduled regular catch-ups and virtual social events outside work

hours – had competitions etc.”

• “There is no way we could sustain that for a long period of time”
• “We experienced some cultural disconnect and isolation and had to regularly check in on our peoples’

wellbeing”

SPECIAL TOPIC: COVID ID-19 | ORGANISATIONAL CULTURE

Cont.

• “Well. Accelerated adoption of suitable protocols”
• “Well and made sure communication was top of list”
• “Devolved decision making to a cross-function team operating through TEAMS worked well”
• “With great difficulty”
• “High trust model worked well in most cases”
• “Trying to adopt more virtual working in regular times including some staff working from home for the

foreseeable future (less people in the open space office = less distractions)”

SPECIAL TOPIC: COVID ID-19 | ORGANISATIONAL CULTURE

SPECIAL TOPIC: COVID-19| REMOTE WORKING

Majority - not considering implementing a remote working option for staff. 18% - would consider 28% - N/A - not an

• ption

54.4% 27.9% 17.7% No N/A Yes 0% 10% 20% 30% 40% 50% 60%

Percentage of enterprises considering, or in the process

• f implementing a remote or virtual work option for all or

some staff

Details provided of considered/implemented approach:

• “In the process of developing a co-working space in South Taranaki”
• “Opportunity for individual staff to work both at home and at the organisation’s locations”.
• “Providing remote access via vpn and laptops”
• “Flexiweek allowing a proportion of the working week to be worked flexibly including

remotely”

• “We now have the permanent option of working a few days per week from home if they

choose”

SPECIAL TOPIC: COVID-19| REMOTE WORKING

SPECIAL TOPIC: COVID ID-19| BIG IGGEST RETURN TO WORK CHALLENGES

29% - social distancing/sanitisation 17% - customer tracking Other challenges:

• Travel restrictions,
• Product availability,
• Anxiety/stress among staff
• Trade restrictions.

29.3% 28.7% 16.6% 12.7% 7.0% 5.7%

Not applicable Ensuring appropriate distancing and sanitisation was available Customer / client management / tracking Other Communicating external visitor appropriateness with staff Consideration of the need of a workplace,

• r co-working space

0% 5% 10% 15% 20% 25% 30% 35%

Biggest challenges faced by enterprises as they returned to business after lockdown

SPECIAL TOPIC: COVID ID-19| LOOKING AHEAD 3-6 6 MONTHS

Over 43% of enterprises are unsure of the

• ngoing impacts of

COVID-19 on their business, with over 28%

• f enterprises

envisioning an ongoing negative impact.

43.4% 28.3% 10.7% 10.1% 7.6% Not sure yet The ongoing impact will be negative for our enterprise The ongoing impact will be positive for our enterprise No ongoing impact, not concerned at all Other 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

How concerned are enterprises on the ongoing impacts of COVID-19 over the next 3-6 months

SPECIAL TOPIC: COVID ID-19| WORKFORCE NUMBERS

45% - anticipate no change to current workforce numbers 14.6 - decrease 13.8% - unsure 9% - increase

45.3% 17.6% 13.8% 8.8% 7.6% 3.8% 1.9% 1.3%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% No change N/A Unsure Increasing workforce Reducing by <10% Reducing by <25% Reducing by >50% Reducing by 26- 49%

Anticipated (or already made), changes to workforce numbers as a result

• f COVID-19

SPECIAL TOPIC: COVID ID-19| ‘CATCHING UP’ WITH WORK

55% - no rush to ‘catch up’ with work once Alert Levels lowered. 38% - Experienced ‘catch up’ Other: “had to put projects on hold due to cashflow issues with investors”, “Had a big rush now very slow”, “Extra work but less staff and more hours”.

54.7% 38.4% 0% 10% 20% 30% 40% 50% 60% No Yes

Are enterprises anticipating/experiencing a rush to 'catch up' with work demands

* Responses do not equal 100% due to respondents being able to enter comments instead of selected a yes or no option

SPECIAL TOPIC: COVID-19| NEW OPPORTUNITIES

28% - COVID-19 has created new commercial

• pportunities for them.

“New commercial

• pportunities are likely …

it’s a matter of keeping aware of the challenges and changes.”

67.9% 27.7% 4.4% No Yes Other 0% 10% 20% 30% 40% 50% 60% 70% 80%

Has COVID-19 created new commercial opportunities for enterprises

SPECIAL TOPIC: COVID ID-19| BORDER RESTRICTIONS AND GLOBAL IM IMPLICATIONS ON BUSINESS

Results – quite close 52% - global border restrictions did not directly or indirectly impact on their business. 48% - did impact on their business.

51.6% 48.4% No Yes 0% 10% 20% 30% 40% 50% 60%

Will global border restrictions or global implications have a direct or indirect impact Taranaki enterprises

• “Options for online digital selling of information will be implemented”
• “Look at preparedness of remote work”
• “Better systems for electronic review and sign off”
• “Less travel. More electronic communications, less direct contact with

clients”

• “Better internal communication and better management of expenses”
• “To be better prepared for future shocks”

SPECIAL TOPIC: COVID ID-19| PRACTICES AND LEARNINGS TO BE IN INTRODUCED

Tech Finance

• “Reduced demand for commercial space – increased flexibility for employees”
• “More readiness to accept non-traditional work practices, e.g. virtual meetings”
• “Fear of travel”
• “Financial viability of business”
• “Slowing in spending as people are more cautious”
• “More focus on innovation, R&D, local manufacturing and exporting”
• “A more centralised economy”
• “More understanding of Taranaki’s work force capabilities and keeping work local”

SPECIAL TOPIC: COVID ID-19| ENDURING CHANGES AND TRENDS

Change in methods

• f

working Financial considerations Support local

SPECIAL TOPIC IC | TARANAKI EXPERIENCE AND LOOKING AHEAD

COVID-19| TARANAKI EXPERIENCE

Since mid-March, almost 600 businesses have approached Venture Taranaki for enterprise support due to COVID-19. Approximately 86% of those businesses were from New Plymouth district.

55.3% 17.0% 15.3% 6.7% 5.7%

Advice sought by Taranaki Enterprises

Financial Business continuity Digital strategy Human Resource Legal

Over 70% of enterprises surveyed during lockdown were extremely or very concerned about the impact

• f COVID-19 on their

business, it was no surprise that over 80% of enterprises had accessed the Governments Wage and/or Leave subsidy scheme.

COVID-19| TARANAKI EXPERIENCE

Venture Taranaki supported enterprises with two COVID- 19 programmes; a Local Fund and the Regional Business Partners programme (a national fund). These funds were used by businesses to access a range of professional services and advice.

Funds issued - $194,400 Funds issued - $501,394 Enterprises supported - 486 Enterprises supported - 227

Local Fund Regional Business Partners Programme

COVID-19| LOOKING AHEAD

Venture Taranaki is leading the economic recovery pillar for the region, under the Civil Defence Recovery Group. The Recovery Plan has been created to guide and focus efforts from May 2020 to mid-2023 and integrates Tapuae Roa and Taranaki 2050 Actions, shaped by COVID-19 impacts.

Thank you | www.Taranaki.info for more