Confidence levels of small businesses across the country have improved markedly, particularly in Wellington.
A quarterly survey by ANZ Bank of 250 small to medium-sized firms found profit expectations doubled in the three months to the end of June.
Business banking division managing director Fred Ohlsson said small businesses, particularly in Wellington, see better times ahead.
He said the survey is indicating that business sentiment has improved across the country and that small firms are planning to increase hiring and investment and they expect profitability to be up in the next year.
Mr Ohlsson said there's a sense that Wellington businesses in particular have turned the corner and survived the worst of the slow down.
He said there's also a suggestion that a smaller public sector has created new opportunities for smaller firms, in particular in the creative sector and information technology.