New Zealand's business confidence has continued to hover around an eight-year low in December as tailwinds provided by an overheated housing market and record levels of migration slow down.

A net 38 per cent of businesses were pessimistic about the year ahead in the ANZ Business Outlook, compared to 39 per cent in the prior survey.

The last survey saw confidence dropped to an eight-year low on political uncertainty after the new government took office.

However, a net 16 per cent of companies see their own activity expanding in the December survey, compared to 6.5 per cent in November.

The historical average is 28.

“The economy is doing the hard yards at the moment,” ANZ Bank New Zealand chief economist Sharon Zollner said.

“Positive forces remain, but the turn in housing, flattening off in net migration and lack of capacity in the construction sector are all dampening near-term growth.”

While she said the new government has “no doubt caused a degree of apprehension amongst businesses”, she noted one headwind that does appear to be easing is difficulty of getting credit.

A net 25 per cent of businesses expect it to be tougher to get credit, versus 41 per cent in November.

“This may be one of the factors explaining the welcome, albeit modest bounce in the own activity measure,” she said.

The survey also showed a net 3.2 per cent of firms expect profit to fall in the year ahead, compared to 13 per cent in November.

Employment intentions improved to 2.5 per cent from a net negative 2.7 per cent in the prior month but remain well off the July peak of 26 per cent.

Across the five sub-sectors, agriculture remained the least positive, though all were firmly negative about general business conditions.

By Rebecca Howard