Access to more workers with relevant skills is stifling business growth across the New England North West region.

The latest Business Conditions Survey from the state’s peak business body reveals 58% of NSW business self-rated as operating below full capacity due to difficulties in accessing the talent and continuously upskilling existing workers. This number is higher at 63% for NENW businesses.

Diane Gray, Business NSW Regional Director for New England North West, said “Businesses are already under pressure from rising operational costs, yet optimism for growth is evident with 36% of businesses wanting to hire in the next three months.”

The top three cost concerns for businesses in the NENW remain insurance; taxes, levies and other government charges; followed by energy.

The survey found 43% of businesses are facing price negotiations, 31% are seeing more demand for cheaper alternatives, and 36% are waiting longer for invoices to be paid.

“Businesses are now waiting longer for invoices to be settled, which means added financial pressure on cash flow and for small businesses, this delay could be the difference between staying open or closing their doors.”

Despite the challenges being faced, businesses confidence is on the rise at -56.7 from 59.5 last quarter.

“Yet, with the challenges being faced, businesses in NENW are geared up and ready for growth, and this is an optimistic position to start 2025,” said Ms Gray.

Key NSW findings include:

• Businesses are turning to international students to fill key workforce gaps, with nearly half of employers saying they’re vital to easing the labour crisis and driving economic growth.
• The top three business challenges are financial management, regulation and compliance, and strategic planning.
• Customer demand remains weak, with 61% reporting fewer purchases and 58% seeing smaller order sizes. Additionally, 38% are facing more price negotiation, and 30% are seeing increased demand for lower-cost substitutes.
• 58% of businesses are maintaining the same headcount and 23% are hiring additional staff.
• Nearly 60% of businesses are operating below full capacity, highlighting significant opportunities for improvement and efficiency gains.

Business NSW is calling on the NSW government to:

• Implement reforms to the Emergency Services Levy to reduce the markup on insurance premiums for SMEs.
• Continue to remove barriers that prevent SMEs from dealing direct with the NSW Government.
• Join the fight against inflation by ensuring public sector wage increases are matched to productivity gains .
• Streamline the recognition of reputable qualifications attained overseas, and
• Ensure that all invoices, both government and non-government, are paid within agreed timeframes.