Latest / Best of Business / Brad Olsen: Infometrics principal economist unpacks how chief financial officers feel about New Zealand's business outlook

Transcript

Brad Olsen: Infometrics principal economist unpacks how chief financial officers feel about New Zealand's business outlook · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from Newstalks'd be follow this
• 0:13
  Speaker 1: and our wide range of podcasts now on iHeartRadio Now.
• 0:17
  Speaker 2: A new survey of chief financial offices shows there's some
• 0:20
  Speaker 2: positivity for the year ahead. The inaugural Hunter Campbell Mood
• 0:23
  Speaker 2: of the CFO survey shows thirty percent of CFOs feel
• 0:26
  Speaker 2: upbeat about upcoming company performance. Infametric's principal economist Brad Olson
• 0:30
  Speaker 2: is all over this.
• 0:31
  Speaker 3: Hi, Brad, good evening.
• 0:33
  Speaker 2: Were you surprised to see this level of positivity.
• 0:37
  Speaker 1: A little bit?
• 0:37
  Speaker 3: I mean both in terms of expectations for the year ahead,
• 0:40
  Speaker 3: but actually just looking at how activity has gone for
• 0:43
  Speaker 3: a lot of companies over the last year. You know,
• 0:45
  Speaker 3: some of the CFOs that were interviewed suggested that, yes,
• 0:49
  Speaker 3: it's been tough. Twenty one percent of their revenue had declined,
• 0:53
  Speaker 3: twenty nine said their profitability had declined. And I think
• 0:55
  Speaker 3: the difference in those numbers sort of suggest you know
• 0:58
  Speaker 3: that obviously costs are still playing a part. But the
• 1:01
  Speaker 3: fact that thirty percentury the upbeat or bullish about company
• 1:04
  Speaker 3: expectations for the year ahead, I think does reinforce what
• 1:07
  Speaker 3: you've seen in other survey and other indicators. That actually,
• 1:10
  Speaker 3: you know, there is a bit of a bit more
• 1:11
  Speaker 3: optimism coming through in the business community about better things
• 1:14
  Speaker 3: to come. Yeah.
• 1:15
  Speaker 2: Now, I mean obviously thirty percent feeling great does mean
• 1:17
  Speaker 2: that seventy percent, So what's going on there?
• 1:21
  Speaker 3: Well, Equally, when we sort of look through some of
• 1:23
  Speaker 3: those figures, you've got sort of thirty percent that are
• 1:25
  Speaker 3: either upbeat or bullish. You've got sort of the bulk
• 1:28
  Speaker 3: in the middle who are sort of going, look, we
• 1:30
  Speaker 3: think that things will be okay, we'll either hold still
• 1:33
  Speaker 3: or will grow but maybe not had our growth expectations,
• 1:36
  Speaker 3: or you know, will grow but we might have our
• 1:38
  Speaker 3: expectations but not really sort of plow through them. But
• 1:41
  Speaker 3: I think it does sort of suggest if you look
• 1:43
  Speaker 3: at the numbers who are reporting that they think things
• 1:45
  Speaker 3: are going to get worse from where they are here,
• 1:47
  Speaker 3: it's still sort of in an all right position.
• 1:50
  Speaker 2: So what is it that they are saying specifically that
• 1:53
  Speaker 2: they're worried about.
• 1:55
  Speaker 3: I mean, there's still a range of concerns out there.
• 1:58
  Speaker 3: I mean, obviously, costs are still a big part of it.
• 2:02
  Speaker 3: And I mean, you know, I think there's been a
• 2:03
  Speaker 3: lot of confidence that the lowering of the official care
• 2:06
  Speaker 3: sh rate has provided to them. Also interesting is what
• 2:08
  Speaker 3: they're asking for from politicians. Some of it is the
• 2:11
  Speaker 3: usual stuff. You know, they want less regulation and sort
• 2:15
  Speaker 3: of policies that support more productive outcomes. You know, they
• 2:18
  Speaker 3: don't want to be dealing in red tape every day.
• 2:20
  Speaker 3: They want sort of you know, the right tax settings
• 2:22
  Speaker 3: so people get on and go to work and do
• 2:24
  Speaker 3: that productive stuff. But sort of almost surprisingly for CFOs,
• 2:28
  Speaker 3: you know, everyone thinks of them from a very traditional
• 2:30
  Speaker 3: finance point of view, but you know this Hunter Campbell
• 2:33
  Speaker 3: now says highlights that actually there's things around the likes
• 2:37
  Speaker 3: of the cost of living, about crime rates, around utility
• 2:41
  Speaker 3: bills and similar You know, there is a much greater
• 2:44
  Speaker 3: focus I think on people and talent from CFOs at
• 2:47
  Speaker 3: the moment. They do care a lot more about the
• 2:49
  Speaker 3: staff that they're looking after. They're having to be a
• 2:51
  Speaker 3: lot more proactive about that, and in fact, they're actually
• 2:53
  Speaker 3: still worried about talent despite the fact the unemployment rates
• 2:56
  Speaker 3: going up, and I think that highlights that we still
• 2:58
  Speaker 3: have a skills mismatch. There's still some good talent needed
• 3:01
  Speaker 3: in the finance space at the minute.
• 3:03
  Speaker 2: Brad, I know you love your infrastructure. What did you
• 3:05
  Speaker 2: make of the announcement yesterday.
• 3:08
  Speaker 3: Oh, look, I think it's encouraging to see that, you know,
• 3:10
  Speaker 3: all of that money being spent going forward on infrastructure
• 3:14
  Speaker 3: and certainly some of those areas that you know do
• 3:15
  Speaker 3: desperately need it. I'm an Northander, I know how challenging
• 3:19
  Speaker 3: it is when the brend Dowins go out. So you know,
• 3:21
  Speaker 3: some of those investments are encouraging. The tricky thing looking
• 3:25
  Speaker 3: through the document is going to be there is a
• 3:26
  Speaker 3: lot of commitment to spend money. There is not a
• 3:29
  Speaker 3: huge amount of that money into the future years that's
• 3:31
  Speaker 3: going spare, So at some point we're going to have
• 3:33
  Speaker 3: to decide do we want to sit in traffic, do
• 3:35
  Speaker 3: we want to have you know, congestion running through or
• 3:38
  Speaker 3: are we happy to pay tolls or taxes or something
• 3:41
  Speaker 3: because we've got to get better quality infrastructure.
• 3:43
  Speaker 2: Yeah, fair enough, Hey, Brad, thank you asway was really appreciated.
• 3:45
  Speaker 2: That's Brad Olson, Infametrics principle economist.
• 3:48
  Speaker 1: For more from News Talks b listen live on air
• 3:52
  Speaker 1: or online and keep our shows with you wherever you
• 3:54
  Speaker 1: go with our podcasts on IAR Radio