Economic report shows Waikato growth remains resilient to lockdown blues

The forecasted high dairy payout will inject a sizeable boost into the regional economy. Photo / Danielle Zollickhofer

The Infometrics Quarterly Economic Monitor report for September shows that despite the Waikato spending the second-longest period of time in level 3 or higher, the region remains resilient with several key economic indicators showing growth.

Overall economic activity in Waikato grew at a strong rate of 4.5 per cent for the July/August/September 2021 quarter, outpacing the national growth rate of 3.7 per cent. The severe lockdown has had an impact, however, with this being a 2.5 per cent decline compared to the same period in 2020.

Waikato Chamber of Commerce CEO Don Good said: "The Waikato has been New Zealand's quiet achiever for many years and it is reassuring to see this trend continues in 2021, despite spending a fair portion of the quarter under some sort of lockdown restriction."

Waikato Chamber of Commerce CEO Don Good encourages everyone to go out and support their favourite local businesses while continuing to follow Covid guidelines. Photo / Supplied

The strong agricultural sector has played a large part in this growth, continuing to operate throughout the lockdowns and buoyed by growing dairy prices. Increased input costs will have a diminishing effect, however, the forecasted high dairy payout will inject a sizeable boost into the regional economy.

Data from Marketview also shows solid consumer spending, up by 7.9 per cent from a year ago which measures well against the national figure of 4.7 per cent.

"The increase in consumer spending is great, and shows that Waikato consumers have bought into supporting local," says Good.

"Our HERTaS (Hospitality, Events, Retail, Tourism, and Sports) industries are really struggling right now, being unable to operate during the lockdown and they need all the help we can give them. We're glad to see people filtering out of working from home on Wednesday and getting back into our CBDs. Even small numbers will provide relief to the hospitality venues in our region," said Good.

House prices and employment growth also contributed towards Waikato's growing economy. Data sourced from CoreLogic indicates house values in Waikato grew at 32.1 per cent versus the national statistics of 29.5 per cent.

Employment was up 1.8 per cent, also outpacing the national figure of 0.6 per cent. Labour market pressures are unfortunately forecasted to increase in scale and scope due to the current skills shortage which may weigh on future growth.

Interestingly car registrations increased by a whopping 15.2 per cent, significantly higher than the New Zealand average of an 8.5 per cent increase, indicating that New Zealanders' love affair with vehicles remains very strong.

"While it's great to see the Waikato has remained resilient during the last few months, not all of our business community have been spared the impacts of lockdown," said Good.

"We are encouraging everyone to go out and support their favourite locals, with a coffee or some food, while continuing to follow the Covid guidelines. Hopefully, by summer we will be able to attend events again and travel domestically to really boost those industries that have been hit the hardest."

A great way to show your support for the mighty Waikato events would be by heading along to Waikato Stadium on Saturday night to watch the young Waikato Rugby team contest the Bunnings NPC Premiership final. They take on the defending champions the Tasman Makos. The kick-off is 7.05pm.