South Island regions dominate ASB economic rankings, Auckland 10th
South Island regions have powered into the lead in ASB's Q1 Regional Economic Scoreboard.
ASB chief economist Nick Tuffley said southern regions were benefiting from strong commodity prices and soaring food and fibre exports.
Canterbury ranked number one, followed by the West Coast, Otago and
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Otago Daily Times
a day ago
- Otago Daily Times
Unemployment to hit nine-year high
By Gyles Beckford of RNZ Unemployment is set to hit its highest level in nearly nine years, as the lagging effects of last year's recession and the sluggish recovery hit hiring and wages. Economists expect the rate to rise to 5.3%at the end of June - the highest since the end of 2016 - and up from 5.1% in the previous quarter, with jobs having been shed and hiring almost at a standstill. "We expect the unemployment rate to rise... as very modest growth in the labour force - labour supply - meets a small contraction in employment - labour demand," ANZ senior economist Miles Workman said. Economists have picked that the labour market was close to the bottom, but the lack of meaningful growth in the past quarter has cast doubt whether this might be the case. Workman suggested a degree of "labour hoarding" had suppressed unemployment as firms opted to hold on to staff in anticipation of an economic upturn. "If a recovery in economic momentum doesn't do the heavy lifting when it comes to 'right-sizing' firms' labour input, a further reduction in headcount may be needed." ASB senior economist Mark Smith said partial indicators since the last set of numbers had shown falling job advertisements, firms still shedding staff, little problem in finding staff except in specialised positions, and people quitting the workforce. "Earlier falls in hiring and more competition for jobs is expected to continue to deter some candidates from actively seeking work." No hiring, some firing Westpac senior economist Michael Gordon said chief among the casualties of the downturn and job losses have been young people. "As the economy cooled off, this group has found themselves out of work again or are struggling to get into work in the first place." The overall slide in immigration from post-Covid gains of more than 130,000 a year to a mere 15,000, and a subsequent exodus to Australia, are likely to be marginal influences for the labour market. However, cooling wage growth may be a more significant factor. Expectations are that private sector labour costs grew about 2.3% in the June quarter - a four-year low - as the weaker employment market shifted the bargaining advantage to employers from workers. That would mean wages falling behind rising inflation, but would also reduce wage pressures on domestic prices. "Wage inflation can be considered broadly consistent with CPI inflation around target, but given we're a decent clip from the labour market entering inflationary territory... it's fair to say that disinflation pressures stemming from the labour market are set to continue for a while yet," Workman said. Kiwibank economists said conditions were right for another Reserve Bank interest rate cut on August 20. "Downside risks to medium term inflation are growing given the soft labour market and dimming global outlook. "We expect the RBNZ to cut the cash rate by 25bps (basis points) at the August meeting. And they'll need to go to 2.5% eventually," they said in a commentary.
RNZ News
a day ago
- RNZ News
Unemployment rate expected to hit nine-year high
As many as 40,000 jobs may have been shed in the in past couple of years, say economists. Photo: RNZ Unemployment is set to hit its highest level in nearly nine years, as the lagging effects of last year's recession and the sluggish recovery hit hiring and wages. Economists expect the rate to rise to 5.3 percent at the end of June - the highest since the end of 2016 - and up from 5.1 percent in the previous quarter, with jobs having been shed and hiring almost at a standstill. "We expect the unemployment rate to rise... as very modest growth in the labour force - labour supply - meets a small contraction in employment - labour demand," ANZ senior economist Miles Workman said. Economists have picked that the labour market was close to the bottom, but the lack of meaningful growth in the past quarter has cast doubt whether this might be the case. Workman suggested a degree of "labour hoarding" had suppressed unemployment as firms opted to hold on to staff in anticipation of an economic upturn. "If a recovery in economic momentum doesn't do the heavy lifting when it comes to 'right-sizing' firms' labour input, a further reduction in headcount may be needed." ASB senior economist Mark Smith said partial indicators since the last set of numbers had shown falling job advertisements, firms still shedding staff, little problem in finding staff except in specialised positions, and people quitting the workforce. "Earlier falls in hiring and more competition for jobs is expected to continue to deter some candidates from actively seeking work." Westpac senior economist Michael Gordon said chief among the casualties of the downturn and job losses have been young people. "As the economy cooled off, this group has found themselves out of work again or are struggling to get into work in the first place." The overall slide in immigration from post-Covid gains of more than 130,000 a year to a mere 15,000, and a subsequent exodus to Australia, are likely to be marginal influences for the labour market. However, cooling wage growth may be a more significant factor. Expectations are that private sector labour costs grew about 2.3 percent in the June quarter - a four year low - as the weaker employment market shifted the bargaining advantage to employers from workers. That would mean wages falling behind rising inflation, but would also reduce wage pressures on domestic prices. "Wage inflation can be considered broadly consistent with CPI inflation around target, but given we're a decent clip from the labour market entering inflationary territory... it's fair to say that disinflation pressures stemming from the labour market are set to continue for a while yet," Workman said. Kiwibank economists said conditions were right for another Reserve Bank interest rate cut on 20 August. "Downside risks to medium term inflation are growing given the soft labour market and dimming global outlook. "We expect the RBNZ to cut the cash rate by 25bps (basis points) at the August meeting. And they'll need to go to 2.5 percent eventually," they said in a commentary. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
NZ Herald
a day ago
- NZ Herald
Te Papa forecasts $13m deficit, downgrades visitor targets
'Te Papa does not generate enough funding to cover required capital investments to maintain Te Papa's building and experience assets [...] to manage inflationary costs, we will be examining ways to deliver our services as efficiently as possible in line with the legislated functions set out in the Museum of New Zealand Te Papa Tongarewa Act 1992.' As a Crown Entity, it receives $44 million in funding each year from the Government and must raise at least $30 million on top of that to stay afloat, made up of partnerships, philanthropy and donations, and its commercial activities like corporate functions. 'Te Papa's commercial revenue is impacted by the current economic conditions, with the most significant commercial revenue stream, corporate functions also being impacted by the reduction in Public Sector spend.' Te Papa, the Museum of New Zealand, Wellington, viewed from Lambton Harbour. Photo / Mark Mitchell Before accounting for depreciation of its assets, the museum recorded a surplus of $1.98m, saying the fact the Government does not fund Te Papa for depreciation is why it has observed such losses. Te Papa spokeswoman Kate Camp said the entity 'has a large number of fixed costs with large, specialised buildings, and collections that require expert care and housing'. 'Some Crown agencies are funded for depreciation, but Te Papa is not,' Camp said. Kate Camp. Photo / Ebony Lamb Camp said the slow recovery in the tourism sector has seen the museum take a hit, with the market being at only about 85% of where it was pre-Covid. 'New revenue streams will come from building on existing offerings like guided tours and paid-for exhibitions.' It is considering charging for more experiences, Camp said, but maintained entry to Te Papa will always remain free for New Zealanders. As for whether the entity would be seeking further Government funding to support its financial recovery, Camp said they are 'always involved in active dialogue with our monitoring agency (Ministry for Culture and Heritage) about what we deliver and the resources required'. Te Papa says maintenance and depreciation of its large, specialised buildings are responsible for its financial struggles. Photo / Mark Mitchell It comes a year after Te Papa first announced it was introducing a $35 international visitor fee, citing the increased cost of energy, insurance and staffing. The charge was implemented in September last year and reportedly brought in $750,000 in its first two months. Camp said the new fee is delivering in line with targets and is projected to raise approximately $3m over the first 12 months. The museum is hoping for a 3% increase in international visitor entry, citing growth from international markets as a 'new focus' for the organisation. Board Chair Chris Swasbrook said Te Papa earns almost half its annual income itself and has a 'continual focus on achieving operating efficiencies for the taxpayer'. Arts, Culture and Heritage Minister Paul Goldsmith holds the responsibility for Te Papa and said the museum's finances are an 'operational matter', but noted the Government 'expects all its entities to operate as efficiently and effectively as any other private business'. Justice Minister Paul Goldsmith at Parliament. Photo / Mark Mitchell While the museum's financials paint a less than rosy picture, it continues to perform well in visitor satisfaction with more than 97% of adult visitors reporting being 'satisfied' to 'extremely satisfied' for overall museum experience during their visit in the last financial year. Last month it was announced as the number one tourist attraction in New Zealand for the second year running and was named in the top 1% 'Best of the Best attractions worldwide' by Trip Advisor. The tourism sector continues to struggle post-Covid, with the latest International Visitor Survey showing spending by international tourists had jumped 9.2% in the last year to $12.2 billion but still remains below pre-Covid levels. In Wellington specifically, the sector contributed $862.9m towards the capital city's GDP in 2024, making up 2.5% of Wellington's economic output, Infometrics data shows. In 2000, that number was 3.2%. Tourism hasn't grown as a sector in Wellington at the same level of other centres, with the economic output in Wellington City's tourism sector increasing by only 2.2% in 2024, compared with an increase of 10.2% for New Zealand as a whole. Ethan Manera is a New Zealand Herald journalist based in Wellington. He joined NZME in 2023 as a broadcast journalist with Newstalk ZB and is interested in local issues, politics, and property in the capital. He can be emailed at
