Business numbers fall for third year

TAMLYN STEWART
Last updated 12:27 30/10/2012

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More businesses closed than new businesses started up for the third year in a row, new numbers from Statistics New Zealand show.

As at February 29, there were 469,120 enterprises in New Zealand, a decrease of 0.8 per cent from last year.

The number of business locations fell across all regions except Wellington, which increased by less than 0.1 percent.

The financial and insurance services, with 29,180 enterprises, recorded the largest decrease with a fall of 3.5 per cent, or 1,070 enterprises.

Manufacturing had 20,580 enterprises, 1.8 per cent fewer than the year before. The number of enterprises in this industry has decreased for the last six years, but still has the largest number of employees (224,200), representing 12 per cent of all employees.

New Zealanders' obsession with property ownership showed up in the business statistics also. Enterprises offering real estate and property rental and hiring services had the largest number of enterprises, 96,820, and the majority of those, 95 per cent, are one-man bands.

Construction, with 49,100 enterprises at February this year also had a fall of 800 enterprises, or 1.6 per cent, but the number working in the industry rose 3000 to 117,800 from February 2011.

Nationally the number of new businesses starting up fell 11.2 per cent while the number of businesses closing increased 2.3 per cent compared to the year before.

Survival rates of businesses were similar to previous years, with 4 in 5 businesses surviving their first year of operation, and close to 30 per cent surviving 10 years.

The number of people employed by New Zealand's largest businesses (100 or more employees) increased by 1.1 per cent, but the number employed by smaller businesses (one to five employees) fell slightly by 0.1 percent.

"Almost half of all paid employees work for our largest businesses," Statistics New Zealand business infrastructure and performance manager Hamish Hill said.

The Auckland region still accounts for almost a third of all business locations, and 33 per cent of all paid employees, while a quarter were in the South Island.

The number of businesses in Christchurch has not fallen as much as expected due to the February 2011 earthquake, although there are 20 per cent fewer cafes and restaurants in the city, new numbers from Statistics New Zealand show.

As at February this year, there were 36,400 businesses in Christchurch, a 2.5 percent fall from the previous year.

The number of businesses located in the Christchurch central business district fell 34.6 per cent, but the city as a whole had only a 2.5 per cent decline.

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Hill said the fall in the number of central city business locations had been offset by growth in the western suburbs.

The mix of industries had also changed.

In Christchurch as a whole there were almost 20 per cent fewer cafes and restaurants, but more than 10 per cent more business locations associated with house construction.

In the western suburbs, the number of employees in construction services was up by almost a quarter, Hill said.

- BusinessDay.co.nz

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