The power of positivity, storytelling and collaboration was both showcased and discussed over breakfast at the Canterbury Insights Forum on Tuesday.
A partnership between the Canterbury Employers’ Chamber of Commerce and ChristchurchNZ, the city’s sustainable economic development agency, the Insights Forum is an opportunity for business leaders to understand how the region’s economy, workforce, and community are really doing. The insights are based on the Chamber’s quarterly survey of its members and the monthly economic insights from ChristchurchNZ.
Leann Watson and Ali Adams, the respective leaders of the Chamber and Christchurch, presented insights to an audience of 130 business leaders at the Chamber and then Linda Falwassar from aerospace infrastructure company Tāwhaki Joint Venture and Shayne Moore from Mint Design joined Leann on a panel moderated by Ali.
The key takeaway from the event was the gap between the relatively healthy performance of the regional economy and the declining business confidence reported by the Chamber’s members. Leann said this decline was reflected in core metrics like expectations of the strength of the economy, investment intentions and hiring intentions.
Just under half of businesses expect the economy to be the same or stronger over the next 12 months. This is down from 61 percent in the May quarter. Investment intentions are down 25 percent to 51 percent – a figure that generally sits in the mid-60s to 70s. And staff hiring intentions also dropped slightly back to 61 percent. Leann said the decline was mostly attributed to rising costs and uncertainty in the lead-up to the recent election, as the survey was conducted prior to the election.
That lack of confidence also showed up in the retail spending figures presented by Ali, with Canterbury consumers appearing to be tightening their belts across discretionary or ‘non-essential’ spend categories. Average transaction values have dropped across clothing, footwear and jewellery; home and garden retail; and recreation and leisure.
This means that while people are still choosing to go out and spend, they are cutting back on how much they purchase each time, to try and reduce the impact of inflation on their budgets.
The impact of this is being partially offset by ongoing recovery in international tourism, with international visitors injecting almost $400 million into Canterbury’s brick and mortar retail sector in the last year. While Ali was making this point, passengers from the first cruise ship of the season, the Royal Princess, were on buses bound for central Christchurch and with about 90 ships expected this season, these benefits will continue to grow.
The other positive trend for the Christchurch economy is what Ali called the “Great Southern Migration.” Over 15,000 people have moved to Canterbury from overseas in the last year, an average of almost 1300 per month. Attracting people from overseas to live and work in our region is essential for tackling the short-term labour and skill shortages that developed in the post-COVID period. It’s also key for addressing the longer-term gaps left in our workforce as our population ages.
Canterbury isn’t just benefiting from international migration. Our region has also been attracting people from across New Zealand. Canterbury has experienced the strongest regional gain from domestic migration for the second year in a row. An estimated 3,000 people relocated to Canterbury from other New Zealand regions in the year to June 2023. Internal migration across New Zealand was almost entirely driven by people moving out of Auckland.
Christchurch’s strong economy and lower cost of housing are drivers of this migration, and these recent numbers confirm what we have been hearing anecdotally. A prominent local mortgage broker told RNZ that 1 in 5 residential mortgages are to Aucklanders moving here and that in the previous six months, his company had done as many mortgages for people moving from Auckland to Christchurch as it had in the previous four years.
While Cantabrians may not be comfortable singing the praises of their home, the message that New Zealand’s second city is more affordable than the other main centres for both living and running a business is clearly being heard around the country and the globe.