The State’s peak body for business, Business NSW, released their Quarterly Business Conditions Survey Report last week. 

Businesses have recorded their highest levels of confidence in nearly two years, but remain concerned about cash-strapped customers, insurance and energy costs.

The gradual rise in business outlook has been cautiously welcomed by Business NSW with business confidence levels coming off an historically low base.

Jane Laverty, Northern Rivers Regional Director for Business NSW told the Lismore App the data is broken down into regions so we can see the impact on the Northern Rivers.

"When we pull the data from Richmond/Tweed and Coffs Harbour/Grafton together, that brings our confidence just a little bit better than the state average. But we've got to remember we're still in minus territory, so we're looking more positive than what we were two years ago, but we're still in that negative territory, which means that we're still cautious."

"And what businesses are telling us is while they are looking more confident even when they're looking ahead into the next quarter, which is exciting for us, they are concerned about the impact of the rising cost of living on their consumers because that's what hits the till for them."

"With interest rates kind of going on hold and not continuing to rise, we believe this has contributed to that confidence boost that they're getting."

Does this split into different sectors?

"Everyone's disposable income has decreased, so what businesses are telling us is that the consumer behaviour is absolutely aligning with that. They've got a higher appetite for lower cost substitutes. They are wanting to negotiate on prices, they are going to the shops less and they are buying less when they do. So, we're absolutely seeing that at the till."

"For businesses in the retail sector. Disposable income may be hitting your usual groceries a little less, but people are not buying a luxury item and they're buying less of certain things. But it is impacting some of your clothing and shoe stores and some of your niceties but not necessities."

"For some of our retailers, the only thing that's a little bit of a saving grace for the Northern Rivers is our visitor numbers that boosts our local economy spend. When people are on holidays, they're looking for those experiences and to take a piece of the Northern Rivers home with them, even if that's interacting with our retailers by going to our local markets and things like that. So we're still seeing that visitor economy helping to buffer what we might normally just be getting from your everyday local shopping here."

Finding staff has been an issue for quite some time, how has that affected local businesses?

"We specifically asked that question around staffing. At a state level, businesses are telling us that 92% of businesses have identified issues relating to attracting and retaining skilled workers. For us, we're even a little bit higher than that in the Northern Rivers and there's two key things, where we're tracking about 20 to 30% higher in the Northern Rivers over the New South Wales average in terms of barriers to attracting and retaining skilled workers and that is a lack of affordable housing and in insufficient housing supply.

"We're also about 15% higher in the cost of living in the area. These are the top three areas that businesses are saying are causing the barriers to attracting and retaining skilled workers."

As we know only too well, housing supply is going to be an ongoing issue for the next three to five years.

"Absolutely. It's really concerning, particularly in the Northern Rivers when we know we have an ageing population. We need to be attracting and retaining our younger workers and enabling them to do so with available housing so that we keep them here. We want them to be educated here and go into the workforce here. Otherwise, we will see that big impact to business in their ability to meet contracts and to keep the doors open if they can't get staff."

"We're looking at that 5 to 10-year pipeline when it starts to get very, very difficult for business. So, the sooner we bring housing into the market and a range of housing opportunities through some good strategies the better. That doesn't mean it's only new builds, we do need to be looking at how we're moving people around the region that are looking to downsize as well. Let's look at some density and opportunities for people not to have to move out of the area if they want to move from a four-bedroom home to a two-bedroom unit because of a lack of availability in all areas of housing."

Have you got any advice for business owners and consumers?

"With regards to the businesses and the consumer change, we're really asking businesses to do another pivot. It's not like they haven't done enough pivots in the last few years, but it means they're looking at what they are offering and looking at their products, looking at their services and scaling that back. Looking at how they can cut costs and increase productivity."

"For consumers, I feel like it's another call out to locals to make sure they continue to shop local first."

Like the floods, we are all in this together and retailers need our help to keep the doors open.