An independent economic outlook report provided to Waipā District Council says New Zealand is in a period of "cautious optimism" despite a finely balanced economy.
The monthly report from Wellington-based Infometrics provides an overview of current economic activity. It says the quick shift to Alert Level 1 and border activity has buoyed confidence and activity. But it notes the global economic picture is worse than expected.
"The speeding up of the pandemic's path is of great concern to our views for global growth, and the flow-on implications for New Zealand and our trade activity," the report says.
While job numbers are not as bad as expected, the wage subsidy extension is keeping more Kiwis in work, covering nearly 300,000 jobs in the first 16 days and costing $1.2 billion. The report predicts an "economic reckoning" once the subsidy ends and as "businesses reassess conditions and job losses mount".
Already 13 council areas are reporting a doubling in Jobseeker Support work-ready recipients from a year ago. A report in May forecast 2000 jobs would be lost in Waipā due to Covid-19, many in retail, wholesale, accommodation and food service industries.
The latest report noted New Zealanders seeking the accommodation supplement in May 2020 was up 16 per cent from 12 months earlier.
Heavy traffic was still only operating at 85 per cent of pre-pandemic levels and freight remains lower than normal. However, the amount of internet usage has fallen back from alert level 4 peaks, probably as people return to work.
In terms of real estate, new listings on realestate.co.nz rose further in June, sitting at higher levels than in the previous year.
But house price figures continue to be "jerky" with low sales volumes making it difficult to assess underlying trends. House sales were down 47 per cent in May 2020 with house prices forecast to soften moving forward.
The report says residential building consents across the country are "holding up better than expected" but that building activity is likely to be hampered in 6-9 months time because of limited financing. Nationally, non-residential building consents were down 5.5 per cent.
Job advertisements are at 57 per cent of pre-pandemic levels and continue to trend up.
"There is a dichotomy in business at present – those who are looking for workers, and those who are shedding workers."
The report says goods trade volumes are holding up but food-based exports have softened in recent weeks in line with the global economic outlook.
An Infometrics report to Waipa District Council released in May noted Waipā was less exposed to the negative economic impacts of Covid-19 because of the district's strong primary sector and its limited exposure to international tourism.
The latest report also noted consumer confidence has "bounced back" after a steep fall during lockdown.
Waipa District Council has announced a $795,000 recovery package to help support and rebuild Waipa's economy and community.