CCIWA Chief Economist
Aaron Morey
The latest Chamber of Commerce and Industry WA Business Confidence Survey shows business confidence accelerating to fresh highs in June, a great sign for the WA economy. Confidence was driven by ongoing strength in the mining sector, optimism around the domestic vaccine rollout and low interest rates.
However Western Australia is fast becoming a victim of its own success, with skills and labour shortages now impacting four in five Western Australian businesses. These shortages have cemented as the number one barrier to economic growth in our State, far outstripping any other concern.
In the past quarter there has been a sharp 25-point increase in businesses who report they are struggling to fill a skilled role. ,The special feature of our report shows the crisis is impacting every sector; reported by 94% of businesses in resources, 91% of manufacturers, 88% in agriculture and 81% in health care. 69% of WA businesses reported increased strain on current staff in trying to meet demand. This was most acute in the education and training (100%), health care (81%) and manufacturing (77%) sectors.
The majority of WA businesses are ramping up training (56%), but more than 3 years’ experience is required for in-demand roles in sectors like resources, manufacturing and professional services. Only around one third (37%) of WA businesses expect to be able to fill the shortfall by hiring locally, with at least one in five vacant positions likely needing to be filled via overseas migration.
These challenges are escalating while overall confidence in the economy builds to fresh highs.
In the short term, nearly nine in ten resources businesses (88%), and three in four manufacturers and professional services providers (75%) express confidence in the economy. The confidence in mining and related industries has driven our short-term outlook to its best position since December 2007. The 12-month outlook has held steady, with 57% of WA businesses confident in the economy’s longer term outlook.
The results emphasise that the response to the crisis must go beyond training and awareness-raising efforts. WA will have to create more space in our quarantine system, with more options such as home quarantine for arrivals from low-risk destinations. Inevitably there must also be a clear and simple system to enable Australian businesses to fill critical workforce gaps from overseas, when demand can’t be met locally. CCIWA also advocates that safely vaccinated Australians should be able to move freely within Australia, unimpeded by State border conditions.
Confidence in our State is founded upon the Government’s success at managing the virus and optimism about the vaccine rollout. These levers remain our best opportunity to build upon community confidence to safely return to life and business as usual.
Read the full CCIWA Business Confidence Survey Report here
