Region tops performance indicators

Shopping activity helps drive economic activity in Otago and Southland. Photos by ODT.
Shopping activity helps drive economic activity in Otago and Southland. Photos by ODT.

The good news continues to roll out for Otago and Southland, as the Performance in Services Index results for November provided the region with a good start to the festive and summer holiday season.

Otago-Southland Employers Association chief executive John Scandrett said yesterday the BNZ-BusinessNZ survey showed the region with a 72.4-point result, by far the highest in New Zealand last month.

The second-highest result was northern on, 60.9 points.

Sub-sector feedback across construction, selected tourism and accommodation, retail and wholesale activities had underpinned the result.

''Positive comments have flowed around such aspects as a notable lift in visitor numbers, unanticipated summer season sales and some general recognition of warmer weather patterns driving early pre-Christmas shopping activity.''

As usual, there had been some borderline sector assessment, he said.

This month, there were some negative opinions expressed by property services and selected tourism operators who had not apparently seen the same level or activity lift as other firms in the sector.

The region also led the Performance in Manufacturing Index released on Friday.

The national PSI for November was 56.3. Although this was down 1.4 points from October, the last three months had remained in the 56-57 expansion range.

A PSI reading above 50 indicates that the service sector is generally expanding and below 50 it is declining. So far in 2013, the PSI has averaged 55.7, compared with 54 for the same time period in 2012.

BusinessNZ chief executive Phil O'Reilly said the last three months had provided values which showed expansion was well entrenched.

''This is also clearly reflected by the positive comments by respondents.

''The proportion of positive comments is now at almost 74%, compared with 71% in October.

"This represents a clear signal from a large proportion of the business community that a range of influences, including the pre-Christmas rush, finer weather, the flow-on work from the Christchurch earthquake rebuild and increased consumer confidence are flowing through to the main indicators of activity, sales and new business opportunities,'' he said.

BNZ economist Doug Steel noted the labour market implications from November's positive results showed overall employment was on the rise.

The rise in the PSI and PMI employment indicators suggested labour demand was accelerating.

The indicators were consistent with the unemployment rate falling below 6% in short order.

"Westpac's current projections had annual employment growth above 3% by mid-2014, or sooner, going by the latest PMI and PSI indicators,'' Mr Steel said.

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