Operators seek wage subsidy in resort

Queenstown is the only place in New Zealand where small business job numbers remain below the pre-Covid rate, a report says.

Instead, many resort business owners feared the end was nigh and were intending to cut staff numbers unless the Government considered a Queenstown wage subsidy.

Accounting software company Xero’s Small Business Insight report said elsewhere, including the rest of Otago, had recorded growth in the sector since lockdown.

One struggling Queenstown business was sportswear shop Champions of the World, which has operated since 1997.

Owner Miles Wilson said his revenue had fallen by 85% and it was a matter of time till he closed up.

"I’m anticipating by May or June, I may not be able to survive."

His business, like many others in the resort, relied on international tourism and the benefits brought by domestic visitors to the town since Covid-19 had been patchy.

Small Planet Sports owner Darryl Tatom said his 40-year-long focus on the local market was paying off.

"Queenstown’s spent too many years chasing that tourist dollar and maybe neglecting the New Zealand local dollar, to some degree."

He sympathised with those who felt put off from visiting by a perceived long-term focus on internationals.

"You’re not going to go down there and support them after all those years of being money-hungry, greedy capitalists."

Xero New Zealand managing director Craig Hudson said the hospitality industry was one of the industries worst affected by the pandemic.

He attributed this in part to the reduced tourism activity in Queenstown.

"It remains the only region with job numbers below pre-crisis levels, with an 8.1% loss between March and December."

Nationwide statistics from the accounting software provider showed an increase in small business jobs compared with before Covid-19, with areas like Wellington having a 12.3% increase and Hawke’s Bay 14.8%.

The closed borders have prompted some, like Mr Tatom, to call for a wage subsidy to support Queenstown’s teetering business community.

But, Nomad Safaris owner David Gatward-Ferguson feared it would result in national debt and hiked taxes.

"We’ll be running at an extra $1billion of debt every week."

Mr Gatward-Ferguson said Nomad’s, which received Strategic Asset Protection Programme (STAPP) funding, was trading at less than 10% of what it was a year ago and he said his staffing levels had fallen from 46 to 16.

He could not put a timeline on when things might come to a head, but said if nothing changed he would have to consider liquidating assets.

KJet owner Shaun Kelly said he would be very supportive of a tourism sector wage subsidy.

"It’s either that or businesses closing down and the staff going on to the unemployment benefit."

The jet-boat company also received STAPP funding, which Mr Kelly said was a "real life-saver".

Income was down by two-thirds and he said cuts were being made after 10 years of growth.

"We’ve done very well and this is not going to last forever, we’re just battening down the hatches to ride this out."

tracey.roxburgh@odt.co.nz