When it comes to growing the local economy, Wollongong businesses could be their own worst enemy, according to a report released by the Illawarra Business Chamber.
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The report, called Knowledge Future, was written by Deloitte Access Economics, looks at ways to boost the professional services sector in the Illawarra.
This sector includes fields like accounting, engineering, marketing and research and information technology.
According to IBC CEO Debra Murphy, if the proportion of the Illawarra economy involved in professional services was on a par with the rest of NSW it would mean another 300 businesses and 3000 jobs.
The report identifies the perception of the region as an industrial town as a weakness when it comes to enlarging the sector.
This leads to both workers bypassing the region and Illawarra businesses being overlooked in favour of those in capital cities like Sydney and Melbourne.
Surprisingly, the report mentions that Illawarra businesses themselves have a tendency to overlook the local market in preference to Sydney.
“Stakeholder consultations revealed that negative perceptions or stigmas regularly prevent local businesses to ‘buy local’,” the report stated.
“This affects all aspects of professional services: local businesses often engage external marketing consultants when considering their strategic vision or market position; local organisations engage large city-based legal and accounting firms despite comparable services being offered locally (and typically at a lower price) and large scale engineering firms are often preferred to local engineers to conduct civil and geotechnical services.”
Other things impinging on the growth of the sector include business owners who are ageing and have “few incentives” to pursue growth opportunities and the ability to recruit labour, with many University of Wollongong graduates choosing to work in Sydney or elsewhere.
Despite this, the report states the region’s professional services sector is growing faster than the overall average – 4.2 per cent a year compared to 2.5 per cent.
It also points out the region has some advantages over Sydney – including lower salaries and office rent as well as higher staff retention rates.