Wednesday, April 24, 2024
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Staycations boost economy

Kiwis enjoying a holiday at home could be helping grow our local economies.

Taking a 'staycation' is one of the key engines driving the growing Thames-Coromandel economy, new data reveals.

Economics consultancy Infometrics calculates the economy expanded 2.5 per cent over the year to March, in line with national growth rates.

Tourism continues to shine as a key contributor to growth, with local tourism spending rising 9.9 per cent over the year to March to approximately $398 million – that’s more than double the 4.0 per cent growth rate recorded a year earlier.

Overall guest nights in Thames-Coromandel rose 4.6 per cent over the year and it’s the local tourists who are coming in greater numbers, with a 7.2 per cent rise in domestic guest nights, while the rate for international tourists fell 3.8 per cent.

The sustained strength in tourism partly drove growth in traffic flows in Thames-Coromandel, which rose 2 per cent over the year to March.

Thames-Coromandel Mayor Sandra Goudie says its pleasing to see such strong results for our tourism sector.

"This reflects what a fantastic job our local operators do in keeping visitors happy and wanting to come to the Coromandel in bigger numbers," she says.

"Our Council is committed to supporting tourism, while keeping it sustainable.

"That's why destination management is one of the priorities we have in our Council's Productivity Plan, focused on high-value opportunities to support positive economic well-being," Mayor Sandra says.

"Last year we received more than $2 million in funding from the Government's Tourism Infrastructure Fund, which is going towards tourism-infrastructure projects that will help us cope with more visitors, and and we are applying for more in the next funding round," Mayor Sandra says.

Destination Coromandel general manager Hadley Dryden says the economic data confirms just how strongly the local tourism market has been performing over recent months.

In particular, April was a stand-out month, when the Coromandel (for tourism marketing purposes, that extends to Paeroa and Waihi) topped the national charts for tourism spending growth with a 26 per cent month-on-month leap to $45 million.

According to the monthly Regional Tourism Estimates visitor spend rankings, the Coromandel also recorded the second highest national growth rate (up 10 per cent at $489 million) for the year, behind Gisborne/Tairawhiti (up 12 per cent to $198 million).

Hadley says the April results are excellent for a month that falls outside the traditional summer peak.

"Destination Coromandel has been focusing on shoulder season growth for consecutive years now, with promising results," he says. "The Coromandel visitor season is now seven months long – from October through to April."

Destination Coromandel is getting ready to release a winter wellness campaign to encourage visitors  in July and August, to help improve the local economy at this traditionally quiet time of year.

The latest Infometrics quarterly data reveals GDP in Thames-Coromandel grew 2.5 per cent in the year to March 2019 – a rate that’s the same as that for New Zealand overall, but slightly lower than that for the Waikato (2.8 per cent).

Consumer spending growth accelerated, up 7.5 per cent from a year earlier, as Thames-Coromandel households show a willingness to open their wallets and spend. Part of this growth in spending was due to the 2.4 per cent increase in enrolments with GPs, a broad proxy for population growth.

Infometrics senior economist Brad Olsen says the consumer spending growth rate is higher than the national average (4.1 per cent) and for Waikato (5.1 per cent).

"The spending rate has helped support the large (70 per cent) annual rise in non-residential construction consents, which is also helping the economy expand," says Brad.

An extra $9 million in consents over the period took the total value of non-residential consents to nearly $22 million. Of this, $7.1 million is for additional shop, restaurant, and bar construction – investment which demonstrates optimism for ongoing growth in consumer spending.

"You only build that if you have people wanting to go out and eat, drink and be merry. So this business investment demonstrates optimism for ongoing growth in consumer spending," says Brad.

Continued economic growth means the local labour market remains tight, with the unemployment rate at 3.0 per cent – still well below the national average.

While the number of Jobseeker support recipients rose 4.4 per cent in Thames-Coromandel over year, Brad points out this growth was slower than the national average of 7.6 per cent.

"It’s not necessarily that the labour market is softening, it’s just there has been a change in government policy and an easing of conditions under which a person can receive a benefit," he says.

"It’s still a pretty good labour market in Thames-Coromandel. Probably, if anything is of concern, it is how businesses will meet their needs as this economic growth continues, given the labour market is so tight.

"It could be a case of being a victim of their own success."

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