Driving economic growth

The suite of economic challenges which face the Queenstown Lakes district are well known.

But the latest Infometrics quarterly regional economic survey suggests that despite the issues being familiar ones, the economy is reacting contemptuously to any attempts to tackle them.

First the good news: Queenstown Lakes has been New Zealand’s fastest growing territorial authority for some time, and in the last quarter it maintained its primacy with an overall GDP growth of 5.9% — the national rate was 1.7%

That has largely been driven by the tourism sector returning to pre-pandemic levels: guest nights rose 64% in the year to September, and to a level last seen in 2019.

That burgeoning regional wealth spurred an 8.3% jump in the employment rate; an extra 900 jobs were added in the accommodation and hospitality sectors and more than 300 new retail workers were also taken on.

The employment rate rose despite a slowing in the number of international visitors, and that statistic requires some further investigation to uncover what has driven it. If it is symptomatic of a drop in bookings due to Queenstown’s ongoing water issues it brings with it the risk of reputational damage and longer-term impact on the tourist market.

Despite that lingering concern, business appears to be booming, and bars, restaurants, hotels and retailers are gearing up for an anticipated bumper Christmas.

But it will not be a festive time for all. As has been well documented, Queenstown in particular but also Wanaka are struggling to find somewhere for those workers to live, and the last quarter figures give little encouragement that situation will ease any time soon.

About 100 people gathered at Queenstown’s lakefront, earlier this year, to demand urgent action...
About 100 people gathered at Queenstown’s lakefront, earlier this year, to demand urgent action to fix the resort’s acute rental housing crisis. PHOTO: TRACEY ROXBURGH
Average house values in the region were up again, to $1.7 million — but nationally, house values fell 5.9% to $909,000 during the same period.

Non-residential building consents were up but, in line with national trends, fewer construction firms were building houses: consents were down 24% in the year to September 2023.

Given those numbers, it is unsurprising that MBIE figures show minimal change in the number of active rental bonds in Queenstown Lakes.

But at the same time the estimated population of Queenstown Lakes grew by 8%, much of which is driven by seasonal workers, many of whom are from overseas.

Where are all these people living? For many, it will be in overcrowded houses sleeping four or more to a room. Some are camping, others are living in their cars.

This too is well known, but all attempts to alleviate it seem to be having little impact. Infometric’s statement that there is "considerable pressure" on the region’s housing supply vastly understates a priority which evidently needs even greater urgency than the efforts already under way to address it.

There was also positive news further south, as Infometrics reported GDP growth of 2% in Dunedin, like Queenstown Lakes ahead of the national average.

Furthermore the city’s population, for so long stagnant, grew 1.1%, the fastest rate of growth in Dunedin since 2017, and the city’s employment rate also increased.

While those figures hint at economic recovery, they come with a warning that unemployment had actually increased and that retail spending, while up, was well below the Otago and national increases.

It is possible Dunedin is starting to experience the long-expected economic boom predicted to accompany the building of the new hospital.

If so, this is a welcome fillip, but maintaining that beyond the project’s timeframe is the challenge facing city leaders.

And another thing

Many people have a natural aversion to calling things what they actually are. Death is a classic example: people use phrases like "passed on" or "slipped away" rather than saying what they actually mean. Yesterday, Elon Musk’s astronautics company SpaceX took this to a whole new level, after a huge crowd watched its latest test rocket explode during what was meant to be a journey into space.

Well, it might be "exploded" to most, but to SpaceX it was a "rapid unscheduled disassembly".

It was not all bad new for SpaceX — it was a test rocket and it did fly further than its predecessor, which had disassembled even more rapidly back in April.

But if their hopes, let alone of those who dream of future human exploration of space, are to be fulfilled, SpaceX has to eliminate "disassembly", unscheduled or otherwise, from its vocabulary.