Entrepreneurs bullish on WA

WESTERN Australia's long-term outlook remains bright, despite the upheaval on global financial markets, with labour shortages continuing to be one of the biggest challenges.

This was the consensus of a panel of business entrepreneurs who spoke at this week's launch of WA Business News 40under40 Awards.

The hottest topic was the US financial crisis but discussion soon turned to how, despite this and other obstacles, the WA business climate should remain positive.

Entrust Private Wealth Management Services managing director Graeme Yukich acknowledged it had been a shocking two weeks; but he still believes the state is sitting pretty.

"What we've gone through in the last fortnight has been unprecedented, as Alan Greenspan said its been a once in a century circumstance," Mr Yukich told the breakfast forum.

"The Australian economy is doing very well, especially in Western Australia.

"We don't see the Australian economy going into recession at all."

And the reason behind his optimism?

"It's not the Chinese century, this is the Asian century," he said.

"From India to China, there's roughly three billion people, around 45 per cent of the world's population, and their desire and demand for a better standard of living will have the greatest impact on Australia's long term future.

"You don't run the risk of recession when [national] unemployment is at 4.1 per cent and you're running the strongest immigration since the boom years of the 1950s.

"This issue in Wall Street will pass but the trend coming out of Asia will have fundamental long term effects."

That notion was echoed by fellow panellist, NGIS Australia managing director Paul Farrell.

"I agree with Graeme, having spent four years living up in Asia," said Mr Farrell

"Their desire to have a standard of living that is much higher than it is at the moment, and the sacrifices they all make to get those mobile phones and good watches and things to make them stand apart, is quite amazing."

However, there is potential for the economic outlook to turn bleak if complacency sets in.

"When it's good, like we currently have here in WA, there's the problem of becoming fat and lazy," Mr Farrell said.

And there are distinct challenges in ensuring the prosperity of the state continues, especially factors such as labour shortages.

Advance Physiotherapy Services owner Lisa Hutchinson has felt the brunt of the fluctuating labour market first-hand.

"It's interesting about staff because my physiotherapist in Newman, about a year ago, left physiotherapy to become a truck driver," Ms Hutchinson said.

"She got a much better pay rate."

The panellists have found that the issue of skills and labour shortages aren't showing any signs of improvement.

"By 2015, we're supposed to be tripling the amount of iron ore production, tripling the amount of gas production," Mr Yukich said.

"We won't hit that mark for the fundamental reason that we don't have the workforce."

Even the public sector is heavily affected, which, in turn, affects the rate in which submissions are assessed. There are currently around 17,000 submissions from mining organisations waiting on approval from the government.

"This [labour] problem will only create further blockages in the system over the next three to four years," said Mr Yukich.

This is a view Mr Farrell passionately agrees with.

"This would not happen elsewhere if they had it as good as we do in WA," said Mr Farrell.

"The current hold up [in government] is stopping investment in WA, and we need to invest in WA for the future.

"Now is the time to invest in doing things smarter, not only to assist our state but also because it will make our state a global leader.

"I would hope the Liberal government look at investing in R&D.

"If we do that we become a smarter state."