Waipā steady, but pain ahead
A $68 million increased dairy payout has seen Waipā buck the national trend with a tiny move upward in average annual gross domestic product over the latest quarter.
But in a report to Waipa District Council Wellington-based economists, Infometrics, note it was the district’s primary sector and strong economy which provided the positive bounce, warning the good news is unlikely to last.
Unlike many other businesses, most primary industries in Waipā remained in operation during alert level 3 and 4 Covid-19 lockdowns. The dairy pay-out alone is estimated to have pushed $527 million into the Waipā economy.
That means Waipā saw a modest 0.2 per cent increase in GDP for the quarter until June, compared to a 1.4 per decrease for the Waikato region and a 2.1 per cent decrease for New Zealand overall.
Covid-19 saw consumer spending in Waipā flatline during the quarter, not as bad as the 1.9 per cent decrease in spending across the wider Waikato and the 2.8 per cent decrease nationwide. Waipā’s tourism spend was down 8.3 per cent compared to 12.3 nationally.
Waipā house prices were also ahead of the pack, rising 8.4 per cent over the previous year and outpacing real estate figures of 7.5 per cent nationally. However the Infometrics report noted “labour market weaknesses could see property market softness emerge early next year”.
Despite the slightly positive results, Infometrics said many Waipā households were in a “tough position”. Waipā jobseeker support recipients rose a whopping 19.2 per cent over the quarter, ahead of the greater Waikato (17.7 per cent) and even more than the 19 per cent national figure. A further 565 people in the district were receiving the Covid-19 wage subsidy.
Nationally, the New Zealand economy took a “severe hit”.
“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,” the Infometrics report said.
Council chief executive Garry Dyet said the quarterly economics information was invaluable in gauging how the district was coping with the ongoing economic fall-out of the global pandemic.
“This is the kind of information we’ll need as we actively move towards setting budgets and confirming work programmes for the coming 2021-2031 Long Term Plan.”