Stats point to stalled economy - Labour

David Cunliffe. Photo / Herald on Sunday.

The first decrease in the number of businesses in New Zealand for nine years is a powerful indicator that the economy has stalled, Labour says.

Statistics released today said the provisional total number of businesses in February was 470,000, down 1.7 per cent from 2009 and the first decrease recorded over the past nine years.

The largest drop, 2800, was in the construction industry.

"National has just presided over the first year since 2001 in which business closures have exceeded business start-ups," said Labour's finance spokesman David Cunliffe.

"National's rebalancing of the economy is all about tipping it over the edge into double-dip recession."

Prime Minister John Key told reporters he wasn't reading much into the statistics.

"There's always a huge number of businesses that come and go within any one year," he told reporters in Vietnam where he is attending the East Asia Summit.

"We're an easy place to set up a company, a lot of people give it a go and it doesn't always work out.

"And when the economic environment is more challenging people will be a little more concerned about setting up a businesses."

Mr Key said the statistic was interesting but he wasn't losing any sleep over it.

- NZPA