Timaru District Quarterly economic monitor - March 2020

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Overview

Indicator Timaru District Canterbury Region New Zealand
Annual average % change
Gross domestic product
3.2%
1.5%
1.7%
Traffic flow
-0.9%
-2.4%
-0.2%
Health Enrolments
1.0%
1.8%
2.5%
Consumer spending
2.6%
2.0%
3.0%
Residential consents
-11.7%
10.8%
9.0%
Non-residential consents
-36.3%
-5.7%
-0.4%
House prices*
2.4%
4.0%
5.9%
House sales
-5.5%
4.3%
2.0%
Tourism expenditure
1.8%
-1.1%
1.4%
Car registrations
55.5%
-30.4%
-11.5%
Commercial vehicle registrations
-7.9%
-25.6%
-12.8%
Jobseeker Support recipients
17.4%
14.3%
11.7%
Level
Unemployment rate
3.2%
3.7%
4.1%
* Annual percentage change (latest quarter compared to a year earlier)

Overview of Timaru District

Timaru District’s economy experienced a solid March quarter, placing it in a good position to approach the COVID-19 induced recession. Infometrics provisional estimates show GDP grew 3.2% in the year to March 2020, well ahead of the national rate of 1.7%.

House values in the district notched up 2.4% to $382,466 as sale volumes fell 5.5% in the year to March 2020. Despite growing house values, residential building consents have fallen nearly 12% over the past year, and likewise non-residential consents fell 36.3%, leaving the construction sector with soft workloads.

Population growth, as indicated by health enrolments, notched up by 1.0% over the past year. This underpinned steady growth in consumer spending, of 2.6%. Car registrations remained very high through the March quarter as hail-damaged vehicles were replaced.

Unemployment held steady at the low rate of 3.2%, under the national average of 4.1%. However, growth in Jobseeker Support recipients of 17.4% in Timaru outstripped national growth of 11.7%.

Infometrics’ modelling for Timaru shows that the district is expected to fare slightly better than the rest of New Zealand, due to its strong agricultural hinterland, and diversified industry mix. Nationally, employment is forecast to decline by 9.8% over the year to March 2021, pushing the national unemployment rate to 9.0%.

Overview of national economy

The COVID-19 pandemic has upended the economy and plunged New Zealand into the sharpest recession in living memory. The March quarter includes the full progression of the virus, from its origins in China and subsequent hit to New Zealand exports, through to border closures forcing lower tourism arrivals, before culminating in the lockdown of New Zealand under Alert Level 4. Our March 2020 Quarterly Economic Monitor only captures the initial economic effects of putting the New Zealand economy on life support. The June Monitor will better reflect activity changes. No sector of the economy will be spared, with the regional impacts dependant on the local economic structure – Infometrics is now forecasting the loss of 250,000 jobs nationally over the next year, followed by a long period of restructuring the economy.