Marlborough Region Quarterly economic monitor - June 2020

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Overview

Indicator Marlborough Region New Zealand
Annual average % change
Gross domestic product
-2.0%
-2.1%
Traffic flow
-8.3%
-9.4%
Health Enrolments
2.7%
2.5%
Consumer spending
-3.5%
-2.8%
Residential consents
2.0%
8.1%
Non-residential consents
-4.4%
-8.8%
House prices*
6.7%
7.5%
House sales
-12.4%
-6.0%
Tourism expenditure
-11.3%
-12.3%
Car registrations
-18.0%
-19.3%
Commercial vehicle registrations
-29.3%
-24.6%
Jobseeker Support recipients
18.2%
19.0%
Level
Unemployment rate
2.6%
4.1%
* Annual percentage change (latest quarter compared to a year earlier)

Overview of Marlborough Region

Marlborough’s economy contracted by 2% over the year to June 2020, in line with the national decline of 2.1%. In the June 2020 quarter, the region’s GDP was 14.9% lower than the same quarter in 2019, while the national economy contracted by 12.6%.

The number of Jobseeker Support recipients rose by 18.2%, comparable to a 19% increase nationally. According to the Infometrics Local Economic Insights Dashboard for Marlborough, as of 1 June 2020, there were 1,382 Jobseeker Support recipients and 120 COVID Income Relief Payment recipients in the region.

According to data received from Marketview, electronic card spending in Marlborough declined by 3.5% over the year to June 2020, and by 20.8% over the quarter when compared to the June 2019 quarter. Spending did however recover from a monthly low of $24m in April 2020, to almost $50m in June.

The number of residential building consents issued in Marlborough continued to decline, from a high of 84 in the December 2019 quarter to 57 in the June 2020 quarter. The value of non-residential consents issued in the year to June 2020 also declined by 4.4% to $58m.

In the housing market, listings and sales declined sharply during the lockdown period, before recovering to more regular historic levels towards the end of the June quarter. The volume of house sales over the year to June 2020 declined by 12.4%, compared to a national decline of 6%, while house prices rose by 6.7% over the same period.

Vehicle registrations also declined sharply over the year to June 2020, with passenger vehicle registrations down by 18%. Commercial vehicle registrations declined by 29.3%, reflecting a weaker outlook for businesses.

Marlborough’s economy has been hard hit by the COVID-19 recession. The continued lack of international tourism, along with the turmoil in international markets for the region’s products, suggest further economic headwinds in the remainder of 2020.

Overview of national economy

The New Zealand economy took a severe hit during the June 2020 quarter, as the COVID-19 pandemic saw the country locked down at home for around four weeks at Alert Level 4, before a rapid move down the Alert Levels to Level 1 in early June. The economy has endured a dramatic shift in focus, from life support at Level 4 to an adrenaline rush at Level 1. Yet the immediate economic ramifications are clear to see – economic activity has fallen, nearly 50,000 Kiwis lost their jobs, businesses struggled to cope with lower earnings, and incomes were reduced. The June quarter likely represents the largest single hit to the economy, but the economic scarring and restructuring will continue to occur over the coming years. New Zealand is not out of the woods yet.