Risks in rock star growth

CECILE MEIER
Last updated 05:00 29/03/2014

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The head of the Canterbury region's development body warns of the risks coming with being a "rock star" regional economy.

New statistics released yesterday show Canterbury was the fastest growing regional economy in the year to March 2013 with good and services increasing 6 per cent.

That sort of GDP (gross domestic product) is more akin to Asian economies.

Canterbury's growth was four times faster than Wellington, almost double that of Auckland and three times the national average, Statistics New Zealand showed.

But Canterbury Development Corporation chief executive Tom Hooper said the rebuild came with challenges and risks for the long-term economy.

"It's a rock star economy. But what everybody needs to remember is that rock stars are incredibly flawed individuals."

Hooper was one of the speakers yesterday at the "Seismics and the City" conference.

"The fact that we are a rock star economy now is wonderful. But are we going to be the Rolling Stones, or are we going to be Britney Spears?"

According to Hooper, we should be wary of manufacturing or dairy workers ditching their jobs to work in the rebuild.

Hooper warned dairy workers or blue-collar manufacturing workers could be lured to "pick up a hammer" to earn more money.

He said it was already difficult to get a bus driver at the moment because they got paid $40-45,000 a year, whereas truck drivers got paid $60,000.

He said the situation would get worse. "The only solution is a larger workforce. That means training and migration."

New Zealand Manufacturers and Exporters Association chief executive John Walley said losing workers to the rebuild was an "ongoing concern" for manufacturing, but it had not happened yet. "There is always potential that people will seek short-term gain, but manufacturing pays well above the minimum wage."

Federated Farmers Dairy chairman Willy Leferink said some dairy workers had left to work in the rebuild, but most had come back after they realised living in Christchurch was a completely different environment.

He said he was not worried about losing workers to the rebuild at the moment, but it could become a problem in future.

Migrant workers exploitation

Hooper said Christchurch had strong net migration, and it needed it to continue and to grow.

"What that means for dear old conservative Christchurch is it needs to get over itself and needs to become a multicultural society and be more welcoming of different ethnic groups that we need to come here."

Stressed communities

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Hooper said the rebuild was taking longer than anybody thought it would do, which was placing "an awful lot of stress on the community".

"If you're a homeowner, and your entire life savings are tied up to your house, you don't care about the CBD rebuild plan, you don't care about anything other than ‘when is my house getting fixed, what is my equity position?"'

Hooper said Cantabrians needed to focus on the long- term impacts of the recovery.

"What we build now determines the future shape of our city."

- BusinessDay

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