Tourism continues to drive region's service sector

Tourism is one of the factors buoying the service sector index in Otago and Southland. PHOTO: ODT...
Tourism is one of the factors buoying the service sector index in Otago and Southland. PHOTO: ODT FILES
Otago-Southland's performance in the service sector index is tracking above the 2016 average, buoyed by tourism operators, cafes and their suppliers.

While the Otago-Southland score eased from January's 64.1 to 59.8 in February, all indexes reflected healthy expansion.

Scores above 50 reflect expansion, and below, contraction.

Otago-Southland's index was up on the national average, which had also slipped, by 0.7 points from January to 58.8 in February, but it was still the second highest level of expansion since November 2015.

Last week, Otago-Southland's sister manufacturing index enjoyed a healthy bounce, rebounding from the slower holiday period, largely underpinned by supplying the strong construction sector.

``The categories are all healthy with activity/sales levels at an impressive 69.2, employment levels and orders/new business at 57.7, supplier deliveries at 54.5 and stocks/inventories at 54.2,'' Otago Southland Employers' Association chief executive Virginia Nicholls said.

The services sector was continuing to perform at a high level which was supported by the positive comments sitting at 77% and tourism operators and the associated cafes and their suppliers were continuing to report positive sales.

She noted the health and community services were now back to full capacity after the Christmas shutdown, while services supplying the strong construction industry were also busy.

``This also includes homeowners who are spending more money on renovating their properties,'' Ms Nicholls said.

BusinessNZ chief executive Kirk Hope said the services sector had been in a ``consistent and positive'' level of expansion during the past four months.

``What's continued to drive solid expansion levels has been in no small part due to the sub-indices of activity/sales and new orders/business remaining over the 60-point mark,'' he said.


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