Region lags in income but port boosts economy

By Joseph Aldridge

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The Bay economy accounts for up to 5.7 per cent of New Zealand jobs but the average household income is almost $8000 lower than the national average, a Government report shows.

Economic Development Minister Steven Joyce this week released a report into the economic performance of New Zealand's regions, including the Bay of Plenty economy.

The Regional Economic Activity Report pulls together for the first time the economic data on all New Zealand's regions. It also provides a breakdown at the regional level of some of the initiatives the Government has under way via its Business Growth Agenda.

According to the report, Bay of Plenty has experienced high employment growth during the past 10 years at 1.6 per cent, but average household income remains at $72,700, compared to $80,600 nationally.

The number of filled jobs in the region stands at 109,460 but the unemployment rate of 7.5 per cent is still higher than the national average of 6.9 per cent.

Agriculture, forestry, fishing, manufacturing, retail trade, healthcare and education are the region's biggest employers.

The region's kiwifruit industry had been hit by bacterial Psa but despite this and other challenges, the region had shown resilience due mainly to the Port of Tauranga, the report says. Mr Joyce said all regions needed to achieve their potential.

"The report shows the strengths, challenges and opportunities in the Bay of Plenty economy.

"In particular it highlights the region's high employment growth, the challenges to the region's kiwifruit industry and a chance to develop its natural resources and assets."

The report shows almost one-third (32 per cent) of New Zealand's export cargo passes through ports in the Bay of Plenty and the region accounts for 7 per cent of international tourism spending.

The region also has more high-growth firms than the national average (21 per 1000 firms compared to 20 per 1000 firms).

Opportunities for the region rest on its key assets such as the Port of Tauranga, its climate and its proximity to Auckland and building the skills of its people to diversify from its primary resource base, the report found.

Tauranga Chamber of Commerce chief executive Max Mason welcomed the report and said it highlighted the key issues Bay locals faced.

He said a reason Bay residents had a lower household income was because they were in lower valued jobs.

"Take tourism in Rotorua and Tauranga for example.

"Whilst we undoubtedly need them, many of the jobs are at minimum wage. Compare these with the oil extraction industry in Taranaki or dairy in the Waikato."

Poor education of 25- to 34-year-olds and high retiree numbers in the region were other contributing factors to low incomes in the Bay, he said.

Tauranga Budget Advisory Service co-ordinator Diane Bruin said people took a hit to their income when they moved to the region.

She said the region was reliant on seasonal tourism and on seasonal work in the horticulture sector, which had undergone many challenges in the past two years with Psa.

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