Region still performing well according to report
Joint Media release: Auckland Regional Council and Auckland
5 April 2005
Region still performing well according to economic report
Auckland growth is strong, retail spending is up, and the finance, real estate and business sectors are the stand-out performers, according to an economic report released this morning by the Auckland Regional and Auckland City councils.
The Business and Economy 2005 report provides an economic assessment of the Auckland region, and looks at the current economic trends, prospects and challenges facing the region. The report indicates that overall the Auckland region’s economy is performing well, with 3.8 percent growth over 2004, and while a number of areas are performing better than others, there are still a number of issues facing the region.
The report was launched this morning at a function at the Auckland Regional Council. Key speakers included Dick Hubbard, Mayor of Auckland; Chamber of Commerce Chief Executive and ARC Councillor, Michael Barnett, and National Bank Chief Economist, Dr John McDermott.
"Growth is a vote of confidence in the future of Auckland," said Mr Hubbard. "Growth presents new challenges, and Auckland City is committed to addressing the transport and infrastructure needs urgently to ensure economic growth is sustainable in the future."
Chief Executive of the Chamber of Commerce, and ARC Councillor, Michael Barnett says that the ARC’s new leadership role in the implementation and delivery of the Auckland Regional Economic Development Strategy, is about tackling some of the challenges facing the region such as skill shortages, and the need to improve productivity, and attract investment into the region.
“The ARC’s new leadership role, and the establishment of a regional forum signals a new approach to economic development, but one that is working well in other large cities such as Melbourne and Toronto. This new role will be a challenge for the Council, and one that will require leadership, courage, and support from both the public and private sectors.”
According to the report, regional employment remains high, with the regional unemployment rate of 3.3 per cent well below the national average, and the business and financial sectors being the largest employers.
In spite of a slight decrease in the number of transactions overall, the housing market continues to perform well, with the average house price of $405,000, well above the national average. High employment and a buoyant housing market both have a positive impact on perceived household wealth, which strongly supports consumer spending, borrowing and housing related activity.
Despite the region’s solid economic performance, there are a number of issues impacting economic growth, and overall the region remains in the bottom quartile of regional rankings. Population growth continues to have an impact on the region, placing increased pressure on infrastructure such as transport, energy, and house and land prices.. A shortage of skilled labour continues to impact on two-thirds of all businesses, with many having to offer more flexible work practices, or look off-shore for skilled staff. There is also increasing pressure on prices and wages, causing economists to call for continued constraint on monetary policy.
Business and Economy is produced annually by the National Bank of New Zealand for the ARC and all seven local councils. Each year it provides a summary of current economic trends, prospects and challenges in the Auckland region. It also features key issues facing the region at the time.
A copy of the report is available