Northland's primary sector continues to boost the region's economy - despite the hit from Delta - with the dairy payout expected to be $694 million.
Northland's primary sector continues to boost the region's economy - despite the hit from Delta - with the dairy payout expected to be $694 million.
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Northland's economy is surviving the Delta outbreak reasonably well, with the region's economic growth better than the national average at almost five per cent.
There are plenty of jobs and growth - with 2200 extra people in the last year, combined with a building spike - and a highdairy payout will help keep the region going, a senior economist says.
Infometrics senior economist Brad Olsen said in quarterly analysis to the Advocate that Northland's economy remains resilient despite the setback from the Delta lockdown.
Provisional estimates from Infometrics point to a 2.6 per annum fall in economic activity in the September 2021 quarter compared to a year earlier, which has slowed year-end growth back to 4.9 per cent.
''Northland's economic activity remains better than the national average, and in line with many other provincial regions,'' Olsen said.
''The Delta lockdown and sustained hard border with Auckland has hurt Northland's tourism sector, with annual tourism expenditure growth flowing back from 20 per cent pa over the year to June to 11 per cent pa in the year to September.''
However, he said, a strong summer, as New Zealand moves to the Covid-19 protection framework (the traffic light system) will help.
''Businesses will be looking for another strong summer like last year to regain revenue. Alert level restrictions and the lack of tourists contributed to the 7.6 per cent pa fall in quarterly card spending across the region, according to Marketview data. This fall slowed annual spending growth back to 4.7 per cent pa, in line with the national average.''
Despite the Delta setback, Northland's primary sector activity continues to boost Northland's economy. Commodity prices remain high across the board, particularly for dairy.
''The higher Fonterra farmgate milk price is expected to see a total dairy pay-out of around $694m in the 2021/2022 season, $67m more than last season. However, high inputs costs including farm feed, are hitting the sector and will limit profits,'' Olsen said.
He said hiring activity is very strong in Northland, with filled jobs for residents up 5.5 per cent pa in the quarter – the second-fastest regional jobs growth.
''Construction, health, and professional services are all major drivers, as is hospitality on the back of previous domestic travel strength. These strong economic fundamentals continue to attract more people to the region, with health enrolments up 1.9 per cent over the last year.''
Olsen said Stats NZ data confirms this trend, with net regional migration inflows to the area adding 2200 people in the last year.
Whangārei-raised economist Brad Olsen says Northland's economy has survived the Delta lockdowns relatively well.
However, housing pressures remain, with the average house value rising over 27 per cent pa to $731,000 in the region. Sustained housing pressure continued to prompt a building response, with 370 residential consents issued in the quarter.
Year-end consent growth stood at 55 per cent pa. Commercial investment has taken a pause for the moment, as supply chain issues bite and the previous pipeline is worked on.
