Severe slump in first quarter

Press, 7 May 1983, Page 25

Severe slump in first quarter

The decline in the business sector had become severe, with the worst downturn in the last five years recorded during the past three months, according to the latest survey of business opinion by the New Zealand Institute of Economic Research. In its March quarter survey released yesterday the Institute said that during the last three months output, employment, and profitability had contracted sharply. Particularly marked was the decline in the manufacturing sector where the de-

terioration in orders, output and deliveries in the quarter ranked as one of the most widespread declines in activity reported in the history of the survey. Export sales were again down, with further deterioration expected during the next three months. However, the Institute said that although business activity during the next three to six months was expected to deteriorate, there was considerably more confidence within the business sector than in the last quarter. A net 22 per cent of

respondents in the March survey expected a deterioration in business conditions compared with 60 per cent in the December survey. Business would continue to decline for the next three months but the worst was probably over in terms of the severity of decline, said the Institute. All sectors expected a resumption of inflationary pressures in the June quarter with increased pressures on costs and prices and on interest rates charged on loans during the next 12 months.