Mining and tourism sectors drive job growth despite economic challenges

Economic activity on the West Coast contracted by 0.3% in the year to June 2024, closely mirroring the national decline of 0.2%, according to provisional GDP estimates from Infometrics.

Although economic activity declined slightly, the West Coast still added 237 new jobs over the past year, marking a 1.6% increase in employment.

Development West Coast (DWC) chief executive Heath Milne noted the job growth was driven largely by the mining and tourism sectors.

“The growth in the minerals sector and tourism has been a welcome boost for the Coast, but this was offset by falls in transport, construction, and agriculture,” he said.

Milne acknowledged that while the economic climate has been challenging, there are signs of improvement on the horizon.

“The Reserve Bank's move to lower interest rates as inflation eases should help restore some economic confidence."

He added that the government's new policy direction has opened up significant investment opportunities on the West Coast, particularly in the minerals sector.

“The region is also poised to benefit from a new industry, with Westland Mineral Sands’ barge Manahau taking its maiden shipment of West Coast mineral sands out of Westport last week.”

While there is definitely some pressure on our retail sector, consumer spending on the West Coast rose by 6.3% over the year to June 2024, exceeding the national rate of 1.9%. This increase was driven primarily by recovering international tourism, with total visitor expenditure up by 11.9% ($55 million)—the highest growth rate in the country, outpacing the national average of 1.8%.

During the same period, guest nights at commercial accommodations in the region grew by 110,800, a 9% increase - exceeding the national growth rate of 5.3%. This increase was largely driven by a 38% rise in international guest nights, which more than offset a 12% decline in domestic guest nights.

“While we've seen strong growth, it's important to note that international guest nights eased by 3.6% in the June quarter, suggesting that the initial recovery-led surge has mostly tapered off,” Milne cautioned.

The West Coast housing market continues to outperform the national average, aided by its relative affordability. House values in the region rose by 7.1% in the June 2024 quarter, compared to a 2.5% increase nationally. The average house value on the West Coast stood at $393,800—less than half the national average and only 3.6 times the mean household income in the region.