North Canterbury Business Opinion Surveys
The North Canterbury Business Opinion Survey is undertaken every six months (April and October) and gives an indication of the mood of our business community. This survey is broadly in line with the NZIER New Zealand Business Opinion Survey which allows us to make comparisons between North Canterbury and New Zealand.
The latest survey took place in October 2023. The results show a significant increase in confidence about the coming months, from North Canterbury businesses. Business confidence has bounced back to positive territory from the very low results that we saw six months ago (net -52% in April to net +6% now).
The latest NZIER survey shows that confidence across New Zealand remains low (net -53%).
The survey was conducted prior to the 2023 General Election, and discussions with participating businesses highlighted the probably cause for the increase in confidence was twofold:
Despite the large lift in confidence, businesses are still doing it tough right now with squeezed margins the most obvious sign of this. Businesses are confident of better profitability over the next six months.
Businesses in North Canterbury continue to grow with net +13% of employers reporting increased staffing levels. Net +20% of employers report that it is now easier to find unskilled staff than six months ago although finding skilled staff remains difficult.
We also noted that businesses are continuing to hold off on discretionary investment, with building developments on pause and plant/equipment investment flat.
Waimakariri Quarterly Infometrics Report
Commissioned by the Waimakariri District Council, Infometrics provides us with quarterly reports detailing what the economic situation in the Waimakariri is. These reports provide many details on employment, building consents, gross domestic product, accommodation, house sales and prices, and retail and vehicle sales.
The latest report is for the quarter ending December 2023.
The Waimakariri District’s economy has shown signs of decline for the first time since Covid hit.
That’s according to the Quarterly Economic Monitor to December 2023, released earlier this month from Infometrics.
The report shows a 0.5% decline in the district’s GDP compared to the year prior. New Zealand’s GDP increased 0.7% over the same timeframe.
Infometrics attributes the decline to a noteworthy slowdown in the construction industry, but local experts believe this will be short lived.
“Commercial consents in the Waimakariri District were up 125% in this quarter,” explains Miles Dalton of Enterprise North Canterbury (ENC). “This is incredibly strong compared to New Zealand as a whole, which saw a 1% decline across the same time period. To us, it indicates that the local construction sector will bounce back quickly.”
In line with this, local company Hazeldine Construction confirms they are looking at a busy 2024.
“We are currently pricing a lot of work, both residentially and commercially,” says Hazeldine Construction Managing Director, Jasmine Hazeldine. “There is a lot of interest. This is exciting and very positive for the rest of the year.”
Jasmine says that whilst the construction industry has seen an easing of access to materials following several years’ difficulty in that area, it is still having to work with consistently high build costs. “We are working hard to make build costs achievable for developers by looking at alternative build methods and different products to reduce costs,” she said.
Other statistics highlighted in the report included a slight drop in housing prices alongside an increase in house sales, an uptick in the unemployment rate, an increase in the number of jobseeker support recipients, and weak prices for both dairy and meat putting pressure on the primary sector.
However, in addition to the expected construction bounce-back, Miles believes other factors including increased consumer spending (up 6.1%), increased employment (up 2.5%) and an increase in the number of businesses (up 2%) will contribute to the district economy’s growth over the coming quarter.
“Overall we’re seeing a strong local economy, buffeted by cold side winds like inflation and the cost of living. It’s a bit more of a mixed bag than we’ve seen in recent years, but the Waimakariri economy continues to demonstrate good strength overall.”
