Canty economy booming but costs up

TESS MCCLURE
Last updated 05:00 06/06/2014

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Cantabrians face some of the biggest increases in living costs in the country.

But the region's economy is booming, driven by the rebuild and expanding dairy earnings.

The latest Regional Economic Activity report focuses on each of New Zealand's 16 regions and their strengths and weaknesses as the Government looks to boost growth in those areas.

Economic Development Minister Steven Joyce said despite the Canterbury earthquakes, Christchurch remained the second largest centre for manufacturing after Auckland.

While employment across Canterbury is on the rise, the cost of accommodation - both renting and buying homes - has climbed well above the national average.

It is expected to continue rising as construction workers continue to flow into the city and current homeowners shift out to complete quake repairs.

However, Cantabrians are still happy that their income levels can meet their needs. Despite a rising cost of living, Christchurch and Wellington had the highest percentage of residents who believed that their wages were adequate, and Auckland had the lowest.

While all regions have experienced Gross Domestic Product (GDP) growth over the last four years, Canterbury has overtaken Auckland as the fastest-growing region, spurred on by the rebuild.

Canterbury's GDP per capita just began passing the national average last year, after lagging below the average for the previous four years.

From 2007 to 2013 Canterbury's GDP increased 33.5 per cent - significantly higher than the national trend - and in 2013 Canterbury's GDP per capita equalled Auckland's.

Other key industries for the South Island have also done well, with agriculture driving the upward trends.

Joyce said: "Over the last decade, agricultural regions have benefited from rising commodity prices for dairy products and, more recently, meat."

Canterbury had had significant expansion of dairy, and there were "opportunities to increase income earned from the dairy sector."

Auckland, Wellington and Christchurch generate 62 per cent of New Zealand's GDP.

Canterbury accounts for 13.2 per cent of national GDP, surpassed only by Wellington on 13.5 per cent and Auckland on 35.3 per cent.

Unemployment in Christchurch is still the lowest in the country, at 3.8 per cent, and the number of people employed in Christchurch grew by nearly 6 per cent in 2013.

High employment means the labour market is tight and employers are finding it more difficult to attract employees, the report said.

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- The Press

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