West Coast economy steadying after tough year

Nationally, GDP was flat in the June quarter and contracted 0.8% over the year.

Infometrics data shows softer returns from mining, construction and transport weighed on GDP for the year to June, while the primary sector provided some stability with a near-record dairy payout and strong meat prices. West Coast dairy farmers are expected to earn $506 million this season, up from a low of $384m in 2023/24.

Development West Coast chief executive Heath Milne said the minerals sector’s GDP contribution was weaker in this reporting period, largely due to external and infrastructure challenges.

“Coal exports took a hit during the extended Tawhai Tunnel closure, and with global prices falling more than 20% at the same time, it had a real impact on the regional economy,” Milne said. “Looking ahead though, the outlook is far more positive.”

Federation Mining’s Snowy River gold project is ramping up, with construction soon to get underway on the new processing plant. The project currently employs over 80 staff and approximately 25 contractors onsite. During the plant construction phase, up to 180 contract workers will be required. Once complete, it will employ around 240 people permanently.

At the same time, TiGa’s Barrytown project and Westland Mineral Sands’ Mananui operation have consents in place, together expected to create hundreds of high-paying jobs.

“These projects will help broaden the Coast’s mineral base,” Milne said. “The sector has always ridden the ups and downs of commodity prices, but with greater diversification into gold, ilmenite, garnet and other critical minerals, we’ll have a stronger and more resilient footing.”

Tourism expenditure fell 1.9% over the year to June, compared with no change nationally. Westland District saw the sharpest decline, while Buller held steady.

“Things were going well until the Knights Point closure in November cut visitor flows at a crucial time. Summer was strong, but numbers started easing in March as the international recovery slowed and Kiwis tightened their budgets with the tough economic climate.”

Despite the dip, Milne said the sector is holding above pre-COVID levels and remains a vital contributor to the Coast’s economy. He noted the upcoming West Coast Tourism Summit on 3 September will be an opportunity for operators and industry leaders to come together, share insights, and plan for the next phase of growth.

Housing was a standout in Infometrics’ report. Average house values on the Coast rose 6.7% in the year to June, compared with a national fall of 0.6%. Grey District led the way, with values up 11% and residential consents surging 77.6%.

“The Grey District result reflects the scale of new developments coming through, like Paparoa Views at Kaiata Park,” Milne said. “We’re seeing a lift in consents, which is encouraging for a region that needs more homes to match future workforce growth.”

Infometrics reports employment across the Coast averaged slightly lower in the year to June (down 0.5%). However, Stats NZ data points to a shift in momentum, with employment in June 2025 rising to 15,055 jobs – up 176 (1.2%) on the same month last year, and 81 higher than May.

“Normally employment on the Coast drops between May and June, so to see a significant lift at that time is a really positive sign. It shows momentum is building again as new projects get underway.”

Mining, agriculture and healthcare accounted for the bulk of the new jobs.

While challenges remain, Milne said the Coast is better positioned than many other regions.

“We’ve had our share of global headwinds like the rest of the country, but there are positive signals coming through. Diversification in mining, strong returns from farming, and new housing supply are all laying a positive groundwork for future growth.”