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Brief Comments on Statistics Recently Released

Manufacturers Economic Bulletin
12 October 1999


Brief Comments on Statistics Recently Released

Overseas Trade – August 1999

 Provisional exports for August increased by 5% from August 1998 with most of the growth continuing to come from the manufacturing sector.

 Provisional manufactured (BMS – excludes meat, dairy and fish products, scoured wool and wood pulp) exports increased by 9%. Exports of both manufactured commodities and elaborately transformed manufacturers (ETM’s) have been strong in the three months ended August.

 Manufactured commodity exports have been boosted by a 23% increase in sawn timber and panel product exports in the last three months. Exports of other commodity products are still weak, despite the fall in the exchange rate.

 Exports of ETM’s have increased by $474 million over the last 12 months (compared with an increase in total exports of $404 million) and now contribute 30% of total exports.

 Exports of manufactured (BMS) exports to Australia have improved over the last three months, reflecting the benefits of a lower exchange rate with Australia. Since August 1998 exports to Australia have increased by $190 million, an increase of 5.5%.

 Provisional imports for August increased by 16%, with strong import growth occurring in most sectors. Results for the three months ended August are:

Capital Goods 14%
Consumption Goods 12%
Vehicles 35%
Industrial Supplies 4%
Fuels 24%

 Imports of ETM’s in the year to August were $19,959 million, $1,812 million up on the previous year, a 10% increase. Imports of ETM’s are therefore continuing to grow faster than ETM exports.

Manufactured (BMS) import and export growth

 ETM imports comprise 80% of imports so bear the main responsibility for the deterioration in the trade balance.

Source: Statistics NZ

Labour Cost Index – June 1999 Quarter

 Total labour costs have remained unchanged since December 1998 due to weaker wage growth and falling non-wage costs.

 Salary and wage rates (including overtime rates) rose by 1.4% in the year to June while non-wage costs fall by 4.1%. Total labour costs were up by 0.5%.

 The main contributor to the fall in non-wage costs was the reduction in ACC premiums in the lead up to the introduction of competition on 1 July. The general consensus is that accident insurance premiums have fallen significantly since 1 July so will have a major dampening effect on labour costs over the next 12 months.

 Another contributor to lower non-wage costs was the fall in interest rates over the past year, reducing the cost to employers of low interest loans for staff.

 In the manufacturing sector the annual changes in labour costs ranged from –0.3% in the Wood and Wood Products Sector to 1.0% in the Machinery and Metal Products Sector.

Comparison between real wage growth for manufacturing employers and employees

 Falling inflation (producers and consumers price indexes) means that real wage growth has accelerated over the last six months, after declining briefly in 1998.

Source: Statistics NZ

Retail Trade Survey – August 1999

 Retail sales growth increased in August, rising by 6.1% from August 1998. Excluding motor vehicle sales and servicing the increase in sales was 6.7%, lifting the quarterly increase to 6.2%.

 Department stores continue to gain market share from other retailers, with a 14.2% increase in sales over the last three months compared with the same period last year.

 Strong growth was also recorded by the cafes, restaurants and takeaways sector, with a 13.2% increase compared with a 1.2% decline in August 1998.

 There is remarkable consistency in the rate of sales growth across the regions surveyed. The rate of increase for August ranged from 5.0% for Wellington to 7.3% for Waikato. Total North Island sales growth was 6.2% while total South Island sales growth was 6.1%.

 In August 1998 by comparison the range in sales growth by region varied from 2.0% decline in Auckland to a 4.3% increase in Canterbury.

Source: Statistics NZ

Business Demographic Statistics – February 1999

 The number of manufacturing businesses declined by 2.6% between February 1998 and February 1999, a decline of 534 businesses.

 The most significant change was a 2.9% decline in the number of businesses employing 5 or less staff. The number of firms in this category has previously increased even when the overall sector is in decline.

Number of enterprises and employment in manufacturing
February 1999

 There was also a fall in the average size of companies that employ more than 100 staff. The number of businesses in this category declined by 5.3% while their number of employees fell by 9.9%. The closure of the car assembly industry will have had a major impact on this category.

 The 323 firms that employ more than 100 staff represent just 1.6% of the firms in the manufacturing sector but employ 48% of its workforce.

Source: Statistics NZ

Income Survey – June 1999 Quarter

 Average weekly personal income for all people aged 15 and over increased by 3.8% between June 1998 to June 1999. The average weekly income was $441 while the medium weekly income was $328.

 There was a greater increase in average weekly household income, which increased from $927 in June 1998 to $964 in June 1999, a 4.0% increase. The median weekly income was $805, 5% up on June 1998, reflecting a greater increase in income for people below the median.

 Much of the increase in income was due to a 2.4% increase in the number of people in paid employment. This was the reason the median weekly income increased faster than average weekly income. The number of people receiving income from self employment increased by 43,600, an increase of 13.2%. The number of females earning income from self employment increased by 23.4%.

Average weekly income for employed people

 The average weekly income for people in paid employment peaks in the 45-49 age group and declines quite steadily after age 55. This is probably a reflection of reduced hours worked over this period rather than a reduction in average hourly earnings.

Source: Statistics NZ

Peter Crawford Phone: (04) 496 2813 (wk)
Trade and Economic Analyst (04) 389 8945 (hm)

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