Services sector 'positive' but 'patchy'

JAMES WEIR
Last updated 11:21 18/02/2013

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The services sector is making a patchy start to the year, with new orders and activity growing but hiring still in the doldrums.

Overall, the BNZ- BusinessNZ Performance of Services Index was 52.6 points in January, up 1.1 points from December, stemming falls in the previous two months.

An index above 50 indicates that the service sector is expanding, but below 50 that it is contracting.

The lead sub-index of new orders/business was in healthy expansion at 57.6 and activity/sales was 53.5. Both indexes were better than December.  

But in contrast, employment at 49.9, slipped back after a slight pick-up in December, while stocks/inventories (49.9) produced an identical result following last months' decline in activity.  

BusinessNZ chief executive Phil O'Reilly said the year had started on a "positive note" with an end to the slide in expansion seen late last year and positive levels for new orders and sales

"Activity is certainly patchy, with differences evident across regions, industries and size of business.  However, on a wider scale, New Zealand's result for January sits only marginally below the JPMorgan Global PSI value of 53.6, which shows solid if unspectacular level of expansion," O'Reilly said

However service sector firms gave more negative comments (52.7 per cent) than positive comments (47.3 per cent). The comments reflected a strong seasonal influence due to the Christmas/holiday season, he said.

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- © Fairfax NZ News

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