2024 – A year of opportunity for Illawarra businesses

ByAdam Zarth -- Executive Director, Business Illawarra

It's time to get excited about 2024. We expect it to be a huge year for Illawarra businesses and our economy as we finally shrug off some of the shackles that have burdened us in recent years.

Inflation is easing and down to January 2022 levels, which indicates better news going forward on interest rates. In addition, experts predict that fuel prices have peaked which will benefit motorists as well as our many members in the freight and logistics sectors.

The notoriously tight labour market that has plagued Illawarra businesses in key sectors like hospitality over the last several post-pandemic years is predicted to ease this year, albeit moderately, with migrants continuing to arrive and local workers entering (or re-entering) the workforce. 

Our Business Confidence Index shows that business confidence in the Illawarra steadily rose from -78 in June 2023 to -50 by November 2023, and respondents indicated that they expect this to improve further to -43c in the current quarter (January-March 2024). 

The fortunes of households and businesses are intertwined, with people being less likely to spend in our local economy when their own finances are under siege, and we all know that there are currently huge cost-of-living challenges for households. That is why, as business advocates, we are so urgently seeking action on housing and energy affordability for the wider community generally - but particularly for key workers.

Unfortunately housing affordability is expected to get worse before it gets better across the Illawarra Shoalhaven. The construction of new dwellings decreased last year due to the combined impacts of interest rate rises, shortages of both construction workers and materials, and sluggish approvals. Housing shortages will hold up the supply of available workers and continue to be a major handbrake on our region’s productivity. 

This year we will step up our efforts to see action at a regional level and will continue to advocate for governments at all levels to support the recommendations outlined in our affordable housing report. Increasing the supply of affordable, well-located housing in the Illawarra will require greater tolerance for change among members of the wider community. We cannot continue to expect high quality services provided by lower paid workers while opposing new housing developments on our streets and in our towns. 

Finding long-term solutions to the rampant cost of energy will require a similar appetite for change. Our region is being asked to play a role in this by supporting an offshore wind zone, which we should approach with an open mind. 

We will continue to advocate for downward pressure on energy costs for business and maximising the opportunities in our region for growth of the clean energy sector including working with the University of Wollongong on a clean energy industry roadmap to inform and guide this important economic opportunity for our region.

Like businesses and households, governments are also grappling with rising expenses, and the NSW Government has made no secret that it is facing considerable financial pressures and looking to trim costs. While there are arguments for moderating infrastructure spending so that resources can be directed to housing, the Illawarra has a significant backlog of major projects which must be delivered to keep our economy growing.

This year, we’re looking forward to the long-awaited Mount Ousley Interchange project kicking off, as well as progress on the Picton Road Motorway that will better connect us to Western Sydney. On that front, we also anticipate progress on the NSW Government’s election commitment to fund and deliver an Illawarra rail masterplan, including a detailed consideration of the South West Illawarra Rail Link – a long-held ambition for us and our members.

Our advocacy for an Illawarra Sport and Entertainment Precinct to replace the tired, existing Wollongong Entertainment Centre saw funding for a masterplan and business case, which we expect will be before government for consideration imminently. We need to provide strong support for government to invest in this important economic driver, as with a vibrant CBD and picture-perfect coastline, Wollongong needs this jewel in its crown to become an entertainment hub for the state. 

We believe that these region-shaping projects will deliver economic dividends to the whole economy, by better connecting us to greater Sydney and by creating major attractions to encourage those from outside to spend more in our local economy. We are looking forward to an exciting year ahead and look forward to working together with the community to make this a year to remember.