WA businesses will hire more staff and spend more on wages as 2019 shapes up as a bonanza year for the State’s economy — with workers to be the big winners.
The Chamber of Commerce and Industry WA says a record number of the State’s businesses are preparing to expand, hire more people and boost wages.
That means, after years of flat wages, more West Australians will be asking for a rise.
The latest WA Super-CCI Business Confidence Survey, carried out this week, offers a snapshot of State-wide economic conditions and business expectations. And the news is all positive, according to CCIWA chief economist Rick Newnham.
More than 10 times the number of business owners said they were optimistic about the future compared with June 2015, when only 5 per cent of businesses expected conditions to improve.
And 35 per cent of businesses expect to increase their workforce in the next three months, while 43 per cent expect labour costs, including wages, to increase.
The survey also revealed 85 per cent of firms expect to increase or keep their production levels steady in the short-term and one-third plan to increase their business investment in the current and next quarter.
Mr Newnham said only 18 per cent of businesses expect higher profitability next quarter while costs and investment continue to grow, meaning they would sacrifice some profits to “invest more, hire more people and pay higher wages in 2019”.
“Employment opportunities are on the rise,” he said.
Overall, the mining sector continues to lead WA’s boost in confidence, with four out five businesses expecting stronger economic conditions in the next 12 months and one-third expecting to grow their business in the next quarter.
That’s on the back of $75 billion in new mining or resources projects.
But the downside could be another WA skills shortage which Mr Newnham said was “already presenting challenges for businesses requiring skilled workers”, with job ads in the mining, resources, and energy industry increasing by 23 per cent in the year to October 2018 — the highest in any industry across the country.
That was echoed by DFP Recruitment chief executive Robert Van Stokrom, who said metal fitters, diesel mechanics, welders, auto electricians and truck drivers were already in short supply and demand was growing for a range of construction trades as building started at new projects.
Mr Newnham urged the State Government to “act now to develop a long-term plan to rebuild the State’s skills base as the economy picks up”, including increasing access to skilled migration and boosting the payroll tax threshold.
Denmac managing director Robert Innocent said the WA design, fabrication and construction company was expecting a powerhouse 24 months with major shopping centre, university and apartment upgrades it had either won contracts for or was hoping to.
Treasurer Ben Wyatt said the CCI survey results were “yet another good sign for our economy”.