What effect will the latest COVID-19 lockdown have on the Coromandel? Highlights from the quarterly economic data for December 2020 02 March 2021 This latest COVID-19 lockdown will be having a huge impact on Auckland, our biggest city, with the flow-on effects expected to be felt around the country. This latest COVID-19 lockdown will be having a huge impact on Auckland, our biggest city, with the flow-on effects expected to be felt around the country. For the Coromandel, Aucklanders are an important economic contributor for our district, which is reflected in our latest quarterly data which has just been released. The Auckland lockdown is also having an immediate impact on our local economy with many organisers now either cancelling or postponing events including: Thames Food and Buskers Festival was to be held this weekend on Friday 5 and Saturday 6 March. It has been cancelled, there is more information and details on how to refund any tickets purchased here Tairua Wet and Wild was supposed to be held this weekend. It has been postponed and no future date available at this time. Pauanui Music at the Point cancelled Mercury Bay Business After 5 meeting and Annual Golf Day postponed “We empathise with the almost two million people living in the Super City that are probably going through a wave of emotions right now – anger, anxiety, despondency and determination to get through,” says our Mayor Sandra Goudie. “And while it’s a little easier for us in the Coromandel to look over the fence and think how lucky we are that we’re not in the same position, only one transaction or meeting with someone that doesn’t get reported could turn into the same situation here, which is why we also continue to stress the importance of contact tracing and staying home if you feel unwell, and following Ministry of Health guidance,’ says Mayor Sandra. Our latest quarterly economic data, for the three months up to the end of December 2020 also reflects the impact COVID-19 is having on our economy. We’re seeing a soaring house market, strong domestic tourism, strong consumer spending and a small increase in population growth. Here's are the highlights: Consumer Spending (Right: Consumer spending for the December 2020 quarter. Provided by Infometrics) Consumer spending continued to recover in the December 2020 quarter. Consumer spending in the Coromandel, as measured by Marketview, increased by 4.5 per cent over the quarter compared to the previous year. Christmas and the summer holidays kept the momentum going following the post-lockdown spend-up of the September 2020 quarter. On an annual basis, however, the effects of lockdowns are obvious. Spending overall for the year was down 3.2% compared to the year before And, the forecasts for spending in the 2021 quarters remain relatively pessamistic. The lack of international tourists over the traditional high season in late summer is likely to widen the spending gap. The possibility of further COVID-19 lockdowns may also discourage any ‘unnecessary’ spending. Tourism Expenditure (Right: Tourism spending over the last few years. Provided by Infometrics) Tourism expenditure increased by 1.5 per cent in our district this quarter, compared to the 15.6 per cent decrease nationally. For this quarter $229 million was spent by tourists, up $3 million from the same time last year. Because Kiwis were opting for more drive-based travel rather than flying, and our close proximity to Auckland, we saw our domestic tourism numbers rise 1.5 per cent per annum. Traffic Flow The lack of international tourism activity has seen traffic flow in some hot spots of NZ fall significantly. Lower import volumes and supply chain disruptions further limited a rebound in traffic flows. Traffic flows in the Coromandel decreased by 12.8 per cent over the year to December 2020, compared to a 10.8 per cent decrease for NZ. Housing/Construction Market (Right: Average house values in the December 2020 quarter. Provided by Infometrics) House price growth has been very strong in recent months, with prices across NZ sitting 11 per cent higher than the previous year - pushed up by record low interest rates prompting buyers into the market. The average current house value in our district was up 13.2 per cent this quarter compared to the same time last year. The average house value in our District was $904,897, compared to $806,151 in NZ. House sales here increased by 13.4 per cent for the year to December 2020. For the 12 months ending December 2020, a total of 1,406 houses were sold in the district. On an annual basis, the issuing of building consents dropped by about 3 per cent compared with the same 12-month period a year ago. Non-residential building consents (mostly commercial) also dropped 55 per cent over the year to December 2020, which has been attributed largely to lockdowns. Unemployment rate and Jobseeker Support (Right: The unemployment rate for the year. Provided by Infometrics) Strengthening job ads, and solid activity in growing industries, set the scene for a more optimistic outlook for the labour market. However, not all groups are performing well, with Maori and Pasifika unemployment rising in December, and women and young people still hard hit. The average unemployment rate in our district was 3.6 per cent in December 2020, up from 2.6 per cent the previous year. The unemployment rate here was lower than in NZ (4.6 per cent) in December 2020 Jobseeker Support recipients in our district increased by 5.1 per cent in the year to December 2020 when compared to the previous year. We had an average of 1,155 people receiving the Jobseeker Benefits compared to an average of 741 the previous year. A plus though - is population growth for our district - indicated by GP health enrolments which increased 2.2 per cent compared to the previous year. We’ve got around 29,500 enrolled with local GPs in the Coromandel right now. Dairy pay-out The national dairy sector looks to be on track for a strong result in the current season, with a total pay-out of $13.7 billion expected if current milk production and prices hold. Fonterra recently raised its mid-point estimate to $7.20/kgms, which would deliver the second-best total pay-put since the record $15.3b in 2014. Read more about Fonterra’s forecast here. The total dairy pay-put for the 2019/2020 season in our district is estimated at approximately $52 million. Our total pay-out for the 2020/2021 season is expected to be approximately $56 million About our Quarterly Economic Reports Our Council uses a company called Infometrics, which provides information about our economy, to help us make informed financial investment and planning decisions based on what we know about population and demographics. It helps our economic development arm understand how we can best support our industries and local businesses. You can read the latest Infometrics newsletter here. You can find more on the quarterly report on our website. If you have a business and want to talk to Council about any issues, give us a call on 07 868 0200.