Economic hit for Canterbury's fastest growing district

Selwyn's economy is predicted to contract by 5.4 per cent. Photo: Supplied
Selwyn's economy is predicted to contract by 5.4 per cent. Photo: Supplied
Selwyn's economy could contract by 5.4 per cent because of the effects of Covid-19, a new economic analysis shows.

The report, prepared by Infometrics in April, shows the district’s economy - which has been one of the strongest in New Zealand for several years - will contract by about 5.4 per cent over the year to March 2021.

The construction sector is likely to be the hardest hit and could see a reduction of 27 per cent, while accommodation and food services could reduce by 22 per cent.

Transport, postal and warehousing activities could fall by 16 per cent.

Professional, scientific and technical services would be reduced by eight per cent, while retail and wholesale trade would fall by six per cent.

The data showed consumer spending and traffic volumes were down substantially during the lockdown.

About 56 per cent of the workforce was able to work under the level 4 lockdown, and the report says 78 per cent of Selwyn’s workforce was able to work during level 3.

Employment in Selwyn is expected to decline by 2100 jobs in the year to March 2021, a drop of 8.6 per cent - lower than the forecast national decline of 9.8 per cent.

Job losses are expected at all skill levels.

The loss of jobs means the overall unemployment rate in Selwyn is forecast to rise from 2.3 per cent in the March 2020 quarter, to 7.1 per cent in March 2021.

This compares to the forecast national unemployment rate of nine per cent.

House prices in Selwyn are also expected to follow the national trend, and decline 10.8 per cent between December 2019 and December 2021 before gradually recovering.

Looking ahead, the report suggests primary sector exports are expected to hold up and food product manufacturing will expand slightly, supporting the district’s longer term recovery.

Selwyn Mayor Sam Broughton said the report provides a mix of good and bad news.

“We can’t ignore the fact that many households and businesses in Selwyn have been hard hit by this pandemic,” he said.

“Many people have lost jobs, businesses have been forced to close, and our overall economic activity has declined steeply.

“It will take time for us to recover from this.

"It’s not a great position to be in but because we are less exposed to the international tourism market we’re certainly better off than many other parts of the country," he said.

Broughton said the Selwyn District Council has a central role to play in the district’s recovery.

“One of the key things we can do is maintain a steady programme of infrastructure projects that support local communities, along with the essential services that our residents rely on every day.

“We’re also talking with community and business leaders about what the future looks like, and how we can work together to build a stronger Selwyn."

 

 

 

suv-updated-banner.jpg

Local trusted journalism matters - now more than ever

As the Covid-19 pandemic brings the world into uncharted waters, Star Media journalists and photographers continue to report local stories that matter everyday - yours.

For more than 152 years our journalists have provided Cantabrians with local news that can be trusted. It’s more important now than ever to keep Cantabrians connected.

As our advertising has fallen during the pandemic, support from you our reader is crucial.

You can help us continue to provide local news you can trust simply by becoming a supporter.

Become a Supporter