North Queensland businesses say confidence is key to growth

Monday 15 October | Categories: Economic Policy, Infrastructure and Planning

At a recent forum held in Townsville, local businesses were invited to have their say on the future of the North Queensland economy with CCIQ (Chamber of Commerce & Industry Queensland).

Buoyed by a strong, diverse local economy, North Queensland’s business community outlined the opportunities of living and working within a region offering a great mix of opportunity and lifestyle, highlighting the potential of the region to continue to grow and thrive.

However, in a region insulated from many of the economic challenges facing other Queensland regions, North Queensland is equally suffering a crisis of confidence that could threaten the region’s prosperity.

CCIQ General Manager of Advocacy, Nick Behrens said, "North Queensland is a region with a strong economic future, but the overwhelming feedback from businesses was that in order to continue to grow, investment in infrastructure and freedom from the burdens of red tape and bureaucracy are required."

"Without doubt there is a strong spirit within the local business community and a passion to succeed, but at every turn businesses felt that someone was trying to stand in their way, hindering their ability to employ, invest and grow.

"Such feeling of restriction, breeds uncertainty and uncertainty damages business confidence which leads to a nervousness to invest and employ.

"There are many ways in which confidence can be instilled in the business community and over the coming weeks and months CCIQ will take the ideas put forward at the road show and turn them into a blueprint for the economic future of the North Queensland region."

CCIQ will work to create an economic blueprint for North Queensland that will outline the steps that all levels of government can take to ensure that businesses in North Queensland continue to grow, creating wealth, opportunity and employment across the region’s communities.

STRENGTHS OF NORTH QUEENSLAND ECONOMY

It was agreed that North Queensland’s diverse mix of industry has the ability to insulate the local economy more-so than other Queensland regions in a period of economic downturn.

Offering an attractive tropical lifestyle, it was highlighted that North Queensland doesn’t always sell this as a key strength.

Business ethics are something to be proud of in North Queensland, with a cohesive business community willing to make space for new entrants while remaining competitive. Townsville in particular has a large government presence with the army being stationed here, consequently offering opportunities for enhanced government-business links.

North Queensland businesses are flexible, adaptable and willing to have a go, but are often held back by unnecessary compliance measures. Although some viewed the population of North Queensland as somewhat transient, it was agreed that this also presents opportunities in that there is a constant influx of new people into the community.

CRITICAL ISSUES

It was recognised that North Queensland, in particular Townsville had performed strongly in the past, but more recently there was a crisis of confidence impacting on businesses willingness to hire and grow.

LABOUR AND SKILLS

• There is a labour shortage in the region with many people not being motivated to work. Given that a large number of people are linked to Government and the resources sector, this has enhanced the problem.
• Businesses need to learn how to recruit the right individuals that will stay around for the long term.

INFRASTRUCTURE

• Roads: When it rains in Bowen, Sandy creek will flood and a large percentage of business comes to a halt. Example includes using substantial amounts of money to patch up potholes without roads being flood-proofed. This includes patching up the Cardwell range but getting past or through Ingham is near impossible in bad weather. A lot of money was spent on the Bowen area such as Sandy Creek, but because the road was left in a gully, it will continue to flood.
• Transport costs continue to rise substantially, while the service SME’s receives from the transport/freight companies continues to go down.
• Health infrastructure is inadequate (need to send people down to Brisbane for treatment which Townsville should have the capacity to do).
• Environmental levies and the cost of waste continue to rise.

RED TAPE

• Occupational health and safety (OHS): having to skill up staff to comply and once businesses reach a number of employees they need to spend substantial amounts on training and safety when it doesn’t necessarily enhance safety operations. Compliance measures are confusing and the cost of managing compliance has resulted in substantial reductions in productivity. This is having a substantial impact on North Queensland businesses ability to deliver and improve.
• Maternity leave payments via Centrelink take up a lot of time for businesses unnecessarily.
• Red tape greatly hinders the ability of young entrepreneurs to initiate their own start-ups. This consequently cuts out competition in the skilled areas, which means costs for customers won’t be competitive.

TECHNOLOGY

• Regional areas outside of Townsville aren’t necessarily going to benefit from the NBN and will receive no coverage. Doctors travelling out to North/West Queensland for complex operations or procedures and not having high speed internet access will be hindered in delivering their services to those who need it most.

FINANCE

• Access to finance for businesses is not as available as it was in the past. There is a misperception about small business capacity to deliver, which needs to change.

BUSINESS COSTS

• Electricity, insurances and tax increases are increasing too much for businesses to keep up.

NEGATIVE POLITICAL/MEDIA COMMENTARY

• Australia is presented to international investors as a basket case because of the negative debate surrounding foreign investment. Need to change this and turn this into positive thinking.

WHAT CAN BE DONE TO HELP NORTH QUEENSLAND’S ECONOMY?

EMPLOYMENT

• With a large demographic dividend, there needs to be further engagement with Generation Y about career opportunities and the benefits of working in the region.
• Jobs boards aren’t always being utilised in the best way possible. Need to focus on how we link job opportunities to those available and wanting to work.
• Look at the Fly in fly out workforce and see if it can be enhanced for Townsville.
• Currently North Queensland’s housing market is more affordable than other regions such as Mackay and could present a great opportunity to attract more activity. Access to quality education for children might currently be restricting this also, with many families not able to wait for extended periods to get their children into schooling.
• Incentivising the opportunities presented with a large spouse demographic due to the army presence. . This is also linked to childcare with a shortage of places available for working parents. Helping local communities such as Ingham, Ayr and Charters Towers to become better equipped in areas such as community support and education to diversify from centre of Townsville. This will also increase domestic travel around North QLD regions.

COMPLIANCE PROCEDURES

• Could be streamlined to provide for a uniform process. Across most industries a lot of the training needed is very similar and could reduce costs on business substantially.
• Furthermore, a streamlining of compliance procedures might actually improve safety rather than just being a form filling exercise.
• Streamlining taxes would cut out a lot of time and unnecessary bureaucracy that business has to comply with.
• Definition of SME by Government should be reviewed, because businesses need to have a critical mass to have the capacity to produce documents and have structured human resource processes.

INNOVATION

• Encouraging young entrepreneurs through reduced costs in starting up a business and gaining access to markets.
• Townsville could become something similar to ‘Silicon Valley’ as the NBN rollout presents a fantastic opportunity to link the North Queensland business community with Asia and the rest of the world.
• Supporting innovations with sustainable energies related to Solar, as well as areas of Waste Management.
• Stronger health and education offerings can help remove the transient nature of the North QLD community.
• Celebrate small business and help change the perception that they can’t deliver.

INFRASTRUCTURE

• With infrastructure upgrades on roads and transport hubs, increased consultation with local businesses and industry is essential to ensure that much needed updates and outcomes actually serve the local communities appropriately.
• Health infrastructure is inadequate (need to send people down to Brisbane for treatment which Townsville should have the capacity to do).

INTERNATIONAL STANDING

• North QLD’s abundance of water and knowledge around agriculture presents a great opportunity.
• Providing agricultural support to Asian countries, especially those impacted by natural disasters.
• Some more in-depth analysis around better utilisation of the Port in Townsville to supply immediate Queensland and international regions more efficiently.