Economic activity in Tairāwhiti has shown signs of decline over the year and is tracking below the national average for several indicators, according to the latest Infometrics Quarterly Economic Monitor.
Provisional data estimates a 0.3 per cent drop in gross domestic product (GDP) for the year to September 2023, compared with a national average of 1.7 per cent growth.
Primary sector employment is considerably lower, largely attributed to lower revenue and increased costs. Richard Searle, General Manager Economic Development says this reflects the economic environment post Cyclone Gabrielle.
“The impacts of land devastation, stock and crop loss and new regulations for the forestry sector are starting to show,” he said.
“On the upside, we are seeing progress on wood waste initiatives, with some potentially commercially viable options being explored. Post-cyclone, the significant roading works will also strengthen pipelines for many businesses in the region.”
Employment for residents living in Tairāwhiti was up 0.8 per cent for the year, compared with the national growth of 3 per cent. Juken New Zealand’s decision to close its timber mill may impact the next quarter's employment figures, with approximately 80 jobs affected.
The annual average unemployment rate in Tairāwhiti was 4.7 per cent in the year to September, up from 4.4 per cent in the previous 12 months.
Spending activity shows greater strength, likely a result of flood recovery programmes. Marketview data shows a September quarter 5.6 per cent increase in card spending in Tairāwhiti despite the pressure on households from inflation. Annual spending growth is five per cent, below the national increase of 7.4 per cent.
Total guest nights decreased by 5.1 per cent, compared to an increase of 48.9 per cent nationally. The region’s visitation relies heavily on the domestic market, accounting for 91 per cent of visitors in the last year. As household budgets become tighter, reduced leisure travel is a factor. In comparison, the main centres of New Zealand a seeing a significant increase from international arrivals.
A Tairāwhiti Gisborne marketing campaign was launched last month, aimed at changing perceptions about the region since the cyclone and communicating to visitors that Tairāwhiti is open for business.
Recent Stats NZ data shows the region’s population grew 1.2 per cent, now totalling 52,600. This was driven by a natural increase (more births than deaths) and a strong boost from international migration into the area.
The construction sector is showing strength, particularly residential consents. A total of 38 new residential building consents were issued in Tairāwhiti through the September quarter. This compares with a decrease of 20.4 per cent nationally over the same period.
The average current house value in the region was down 5.7 per cent compared to a year earlier, with the average house value sitting at $596,121 in September. Comparatively, the national average house price was down by 5.9 per cent to $908,853.
Infometrics Quarterly Economic Monitor Tairāwhiti September 2023