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Hospitality Industry Contracts
16 July 2007
Media Release
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Hospitality Industry Contracts
Hospitality sector activity is contracting according to Business New Zealand's new monthly Performance of Services Sector Index, this comment from the Hospitality Association's Chief Executive Bruce Robertson.
While the index for the whole service sector stood at 57.8 accommodation, cafes and restaurants dropped to 48.3 down from 58.9 in April.
Mr Robertson said this reflects the anecdotal comment from the industry that the discretionary dollar is drying up and New Zealander's are starting to put their wallets away. He said it was not unusual for the hospitality sector to feel an economic downtown ahead of the rest of the economy and commented that he would not be surprised if the rest of the service sector followed in the months to come.
Mr Robertson suggested that a strong uptake of KiwiSaver would further hurt the sector as those joining the scheme would have their discretionary income reduced by 4%.
The new survey is a useful tool as it seems to be reinforcing messages from the market place, he said.
ENDS
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