Business Needs Survey 2022November 2022Green Global Connected The Council of the City of Sydney acknowledges the Gadigal of the Eora Nation as the Traditional Custodians of our local area. We acknowledge Elders past and present and celebrate the diversity of Aboriginal and Torres Strait Islander peoples and their ongoing cultures and connections to Country. 01. Executive Summary 402. Key Insights 503. Economic Overview 604. Business Trends 1105. Business Needs 1606. Analysis of Key Sectors 2007. Analysis by Area 2808. Conclusion 3309. Methodology 343ContentsDocument InformationCity of Sydney Business Needs Survey 2022 Published October 2022Author: BIS Oxford Economics, level 6/7 Macquarie Pl, Sydney, NSW 2000 (02) 8458 4200Thank you to all the businesses who participated in the 2022 Business Needs Survey. For any enquiries about this document, or to sign up to receive future surveys and have your say about your business needs, please email: citybusiness@cityofsydney.nsw.gov.au This report contains findings of the City of Sydney’s third annual Business Needs Survey. The survey ran between 8 August and 18 September 2022 and was distributed widely to businesses across the City of Sydney local government area (LGA) through all City of Sydney marketing channels, industry and community bodies and key business stakeholders. The survey received a to-tal of 564 complete responses and the responses were weighted against the City of Sydney Floor Space & Employment Survey 2017 to ensure industry sector proportions reflect the distribution of the overall business sector mix.Data from secondary sources presented in this report was vali-dated in October 2022. Primary City of Sydney Business Needs Survey data is up to date as at time of publication. While all care is taken to ensure a high degree of accuracy, the contributors accept no responsibility for any injury, loss or damage arising from the use, error or omissions therein. Users are invited to notify the City’s Business team of any discrepancies.Front cover image: Petal & Fern, Potts Point, 2020 Photo: Katherine Griffiths / City of Sydney Executive SummaryBusiness Needs Survey 20224This result reflects the challenging macroeconomic outlook in Australia and the city. Rising interest rates, falling house prices and high inflation are expected to constrain future spending. However, the return of international visitors, students and workers will have an outsized impact on the City – particularly the parts of the City still suffering from lingering Covid-19 constraints. It should also be noted that businesses that struggled the most through the Covid-19 pandemic may not have remained opened and therefore are not captured in the 2022 Business Needs Survey.The City’s economy as a whole has now recovered to pre-Covid-19 levels. However, the recovery has been uneven across sectors. Office-based sectors such as finance and professional services have led the recovery while many businesses in consumer-dependent sectors have continued to struggle. This split is even more pronounced in the CBD where an increasingly persistent trend towards hybrid working has lowered foot traffic. Business needs have changed in line with changes in the business environment. While a desire for additional business grants remains, the need has receded relative to the 2021 survey and is concentrated amongst small businesses. On a more granular level the needs of businesses are broadly split between office-based and consumer-dependent businesses. Office-based businesses tend to desire support in finding skilled workers and reducing red tape while consumer-dependent businesses seek greater levels of precinct activation.Businesses have been busy improving their offerings. Three out of four businesses in the City have expanded at least one aspect of their digital services in the last year - half of all respondents plan to focus on social media marketing, customer acquisition and retention over the next 12 months. Strategic planning, business continuity and resilience initiatives follow closely in terms of priority as businesses seek to adapt and thrive in an era of uncertainty. The annual Business Needs Survey is a critical source of information to support the decisions and programs the City of Sydney (the ‘City’) develops in support of its local businesses. The City first conducted the Business Needs Survey following the first lockdown initiated in response to the Covid-19 pandemic in 2020.The survey aimed to provide insight into the needs of small business operators to determine the best approach in supporting them to remain economically viable. The surveys conducted in 2020 and 2021 have directly informed activation initiatives such as the Al Fresco city outdoor dining program, CBD Activation Grants, Precinct Activation Grants, red tape reform, and capacity building programs like Reboot Webinar Series and the Business Innovation Program Series.The 2022 Business Needs Survey was open from Augu