West Coast economy grows by $96m over the year to June 2022

The West Coast economy grew by $96m to $2,365m during this period.

However, Development West Coast (DWC) Chief Executive Heath Milne said momentum appears to be stalling.

GDP in the June 2022 quarter was 0.4% lower than the June quarter in 2021.

Consumer spending in the region grew by 1.8% for the year to June, but it has been outstripped by inflation at 7.3%, meaning there has been a decline in real terms.

“Inflation in New Zealand has reached levels not seen in over 30 years, so it’s little surprise we’re seeing a drop in consumer confidence,” Milne said.

Tourism spending on the West Coast has fallen 10.5% in the past twelve months, however this is more of a tapering off from a particularly strong June 2021 quarter.

Buller has done well to pivot towards domestic tourism, with visitor spending higher than in June 2019, but the region as a whole has struggled to replace international visitors, with expenditure in Westland remaining far below pre-pandemic levels.

Milne reminds COVID-impacted tourism businesses in Westland that applications to MBIE’s Tourism Communities: Support, Recovery and Re-set Plan (SRR) via DWC close on 31 August.

“Westland businesses have accessed over $3m in support through the SRR programme since it opened.”

Over the past year there has been 129 new filled jobs on the West Coast. Job numbers have risen from 14,509 in June 2021 to 14,638 in June 2022, according to Statistics New Zealand.

“Job growth in all three districts has largely been driven by the construction industry,” Milne said.

Over the same period there has been a drop in Jobseeker recipients, with 87 less West Coasters receiving Jobseeker benefits. The Ministry of Social Development reports Jobseeker recipient numbers fell from 1,524 in June 2021 to 1,437 in June 2022.

Unemployment on the West Coast sits at 3.7%, just above the national rate of 3.3%.

“Like the rest of the country, we’re experiencing severe skills and labour shortages which is constraining our growth,” Milne said.

“DWC is currently working with other stakeholders on a major regional recruitment campaign to help attract more people to the Coast.

“Applications have also opened for the DWC tertiary scholarships, which are aimed at growing and retaining our young talent.”

House values on the West Coast are up 33.7% from June 2021, the highest growth in the country.

This rise reflects climbing house values across the entire region. Building consents are also strong, with both residential and non-residential consents growing faster than the national average, at 66.5%pa and 31.6%pa respectively.

However, Milne says “with rising interest rates, escalating costs, supply chain issues, and a shortage of tradies, new builds may become less attractive in the near term.”

DWC will be hosting Brad Olson from Infometrics for economic updates in Hokitika and Westport.