BOP economy jumps to second place

Bay employment increased 8.3 per cent according to figures released for the last quarter, and new car sales rose by 7 per cent.

The Bay of Plenty has jumped to second place in a quarterly economic scoreboard - an encouraging sign for the region, economic experts say.

The region bounded ahead in construction, up by 57 per cent on the same quarter last year, the third biggest increase nationwide.

House prices followed suit, increasing by 6.2 per cent year-on-year.

Nathan Penny says it's good to see house prices bouncing back after the global financial crisis.

The Bay of Plenty saw the biggest increase in employment nationwide, jumping 8.3 per cent.

New car sales were up by 7 per cent. Retail trade saw the only dip, down 4 per cent on last year. Craigs Investment Partners analyst Mark Lister said retail was "still pretty tough right across the country".

"So I'm not terribly surprised by that."

People may be waiting to see if the growth continued, "before they get their wallets out and start spending again", he said.

"Just because their house price has gone up on paper, it doesn't mean they have more money in their hands."

The early indicators of growth were looking good for the region but it was still early days, Mr Lister said.

"We still haven't seen a sustained move in any of those areas.

"Hopefully those early indicators continue."

ASB economist Nathan Penny said the kiwifruit industry was "well and truly back on the horse" and that was benefiting the region.

"We're seeing a few things come together all at once which is positive for the region."

It was good to see house prices bouncing back after the Global Financial Crisis, Mr Penny said.

The lower retail figures were not too much of a concern, he said, as it may have just been a result of a busy first quarter.

"It may be a temporary pull-back because people spent a lot in the March quarter."

It was great to see Tauranga jobs growth figures looking so strong, Tauranga Chamber of Commerce chief executive Stan Gregec said.

"That's a good indicator that the region as a whole is doing pretty well at the moment.

"I suspect the slower retail sales might have something to do with the time of the year and people being just a little more cautious with their discretionary spending," he said. "With spring just around the corner, I expect people will be ready to splash out a bit more. Maybe not so much the dairy farmers from out of town this year."

What is the Regional Economic Scoreboard?

* The NZ Regional Economic Scoreboard takes the latest quarterly regional statistics and
ranks the economic performance of New Zealand's 16 Regional council areas

* The fastest-growing regions gain the highest ratings, and a good performance by the
national economy raises the ratings of all regions.

* Ratings are updated every three months, and are based on a number of key measures

- ASB Regional Economic Scoreboard