Poll: Kiwis glum on economic prospects

JASON KRUPP
Last updated 05:00 07/01/2013

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Finance Minister Bill English may be confident the economy is on track for a moderate expansion in 2013, but New Zealanders are far more pessimistic about growth, jobs and salary prospects.

That's according to the latest HorizonPoll survey conducted at the end of last year, which showed that 34.2 per cent of respondents expected the economy to decline in 2013, versus 28.9 per cent who saw it growing.

The dour macroeconomic outlook worsened for manufacturing, with 42.9 per cent of respondents expecting the sector to decline versus 25 per cent who expected it to pick up.

That fed into employment and earnings expectations, with two-fifths expecting the job market to decline, and almost half expecting household incomes to fall in the year ahead.

Just over 32 per cent of respondents said they expected their retail spending to decline, narrowly edging out 31.1 per cent who expected it to remain static.

The survey was based on an online poll of 2425 people late last year, who were pre-selected from purchased lists to match the demographic and political breakdown of the country.

The results broadly match the Institute of Economic Research's most recent consensus forecast, which polled banks, institutional investors, Treasury and the Reserve Bank, and showed they see the job market softening, unemployment remaining high and wages subdued.

However, the NZIER poll showed overall economic growth was seen at an average 2.5 per cent over the next three years thanks to the Christchurch rebuild.

HorizonPoll manager Grant McInman noted households with incomes of $70,000 to $200,000 were more likely to hold a positive view of the economy.

However, the wealthy (those earning $200,000 or more), intellectuals as well as business owners and the self-employed were likely to have a glass-half-empty view of their prospects in 2013.

The areas where Kiwis were upbeat were on exports, with 34 per cent expecting the sale of New Zealand-produced goods offshore to pick up, versus 23.3 who predicted a decline.

That appears to be largely driven by agriculture, with 36.7 per cent forecasting the sector will grow over the next 12 months, and only 16 per cent picking a drop in farm activity.

Research and development activity was largely split between pessimists, optimists and those who expected no substantial change.

Just under 30 per cent expected the conditions of the environment to decline versus 19 per cent who saw it improving in the year ahead.

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- BusinessDay.co.nz

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