Southern service sector doing well

Events and the cruise ship season are all contributing to an upswing in the southern services sector; pictured are cruise  ships Regatta (foreground) and Ovation of the Seas at Port Chalmers last week. Photo: Gerard O'Brien
Events and the cruise ship season are all contributing to an upswing in the southern services sector; pictured are cruise ships Regatta (foreground) and Ovation of the Seas at Port Chalmers last week. Photo: Gerard O'Brien
The Otago-Southland service sector is finishing the year on a high, registering its strongest month in expansion for the past two years and well above the national average.

The BNZ-BusinessNZ Performance in Services Index for Otago-Southland matched its sister manufacturing index from last week and both the November results headed the country's four regions.

Otago Southland manufacturing stood at 57.7 points last week and the services index this week booked 69.6 points for November. Northern and Central North Island services indices were on 61.5 points, Canterbury West Coast on 60.1 and Lower North Island on 58.2.

The national average was up 0.7 to 56.4 points.

Points above 50 reflect expansion and below, contraction.

Otago Southland Employers Association chief executive Virginia Nicholls said the southern food wholesale trade had a ''solid month'', and were reporting that the build-up to the summer season was ''progressing well''.

''The tourist season was well under way and the cruise ship season had started positively,'' Mrs Nicholls said.

BusinessNZ chief executive Kirk Hope the national rise to 56.4 points put a halt to two consecutive months of lessening expansion, underpinned by a pick-up in key sub-indices of activity-sales at 60.5 and new orders-business at 60.7.

''It was also good to see the proportion of positive comments for November, at 68.7%, build on the substantive lift in October of 67.6%, with many outlining seasonal factors at play,'' Mr Hope said.

BNZ senior economist Doug Steel said that positive signs were widespread across the services index. Expansionary readings were seen in the unadjusted results across all industries, regions, sub-components, and firm sizes.

The regional Otago Southland breakdown in the contributing sub-categories were all in expansion. Mrs Nicholls said the activity-sales levels, orders-new business and stocks-inventories were all above 60 points, while employment levels and supplier deliveries were in the mid-50s.

Mrs Nicholls highlighted that significant events attracting visitors were very important across our whole region.

''A good example of this is the Air New Zealand Queenstown International marathon which attracted record number of entries.

''This had a positive downstream effect on accommodation, local attractions, cafes, and restaurants,'' Mrs Nicholls said.

Those businesses providing services to the construction industry also reported they were busy, she said.

simon.hartley@odt.co.nz

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