Infometrics senior economist Brad Olsen said regional economies were "pressing ahead", rising job numbers, robust spending activity and higher building levels all helping to accelerate economic momentum.
The Hawke’s Bay and Gisborne regions surged ahead, activity rising 3.7% year on year in the December quarter, according to provisional estimates from Infometrics, compared with a 0.2% national rise.
Strong primary sector activity has supported economic activity in the eastern North Island, fruit exports performing particularly strongly, Mr Olsen said in a statement.
But not all parts of the economy were back to normal or seeing booming activity; Otago continued to be hard hit by the loss of international tourism, tourism spending falling
23% year on year, compared with a 16% fall nationally.
Enterprise Dunedin director John Christie said Dunedin City’s economy had been more resilient than the rest of Otago’s across all indicators.
Most of Otago’s weakness had been skewed by Queenstown Lakes’ loss of tourism revenue, but Dunedin had been "relatively insulated" because its international tourism sector was a smaller share of the economy.
"Overall, Dunedin is faring pretty well, all things considered. The impact of Covid-19 did mean economic activity was down 2.8% for the year, but this included the lockdown period when many businesses simply could not operate.
"And despite border closures affecting the visitor and international education sectors, economic activity in Dunedin during the December quarter was almost on par with a year ago, down just 0.5%," Mr Christie said.
An Infometrics report on Dunedin City said consumer spending had recovered on a quarterly basis, spending up 1.7% in the December 2020 quarter compared with the previous corresponding period.
Spending was still down 3.7% for the year to December 2020, reflecting the large hole in spending caused by the June quarter lockdown.
Dunedin’s housing market remained strong, although the rate of house value growth had recoupled with the national average after several years of extreme value growth.
The number of Jobseeker Support recipients had grown 24.5% in Dunedin, behind the national trend of 35.9%. Nearly two-thirds of Dunedin’s increase in Jobseeker Support recipients in the past year had been those who had been on a benefit for one year or more.
Meanwhile, year-on-year small business revenues nationally declined 6% in the month of January, while jobs increased almost 2%, according to data from Xero Small Business Insights. The drop in small firms’ earnings follows continued revenue growth in the June to December period.
Declines were experienced by businesses across all regions of the country, Queenstown firms being the hardest hit, experiencing a more than 23% decline in revenue.
Big drops were also felt in Otago, revenues falling 14.7%; Waikato, which was down 7.8%; Bay of Plenty, which fell 5.6%; and Hawke’s Bay (down 4.6%). Auckland revenues were down 4%, the smallest fall of all regions.
Xero managing director Craig Hudson said the downturn in revenue was a sign "Kiwis needed to continue to support local businesses".
— Additional reporting The New Zealand Herald
