Article: Speak Easy

Northland’s Economy: Let’s Not Get  Economic With  The Truth with Michael BoturNorthland’s Economy: Let’s Not Get Economic With The Truth with Michael Botur

ASB’s Regional Economic Scoreboard, based on updates from The Main Report Group, said in its March update that Northland is NZ’s second fastest growing region, based on employment, construction, retail trade, and house prices. “Northland burst back up the rankings in the latest Scoreboard,” the report claimed. “The region is snapping at the heels of first-placed Nelson.” The authors, presumably, are unaware that Northland is a laid-back place where nothing ever bursts or snaps or happens quickly. “The annual growth rate for new car registrations and retail sales is stronger than anywhere else,” the report explained. “The tourism boom is helping the region, and although the employment figures are ropey these days, Northland’s labour market is clearly improving.”

Hang on: do those four measurements really indicate how much money is flowing around our region? Northland continues to have the lowest median household income in the country. At just 175,000 people, we have one of the smallest regional populations and our numbers are susceptible to influence from Auckland. Not all money that arrives in Northland stays in Northland, so let’s talk about whether we can really measure Northland’s 2017 economic performance based on just four factors. 

Employment: the 2013 census (which desperately needs updating) indicated far too many Northlanders remain working in low paying industries threatened by tech innovation, globalisation and poor dairy prices. The most common job type for Northlanders is agriculture/forestry/fishing, industries which face competition from ports, forests and fisheries in other parts of NZ and the world. Yes, the Tai Tokerau Northland Economic Action Plan is excited about manuka forestry seedling planting, sheep and beef farming strategies, and commercialisation of kingfish farming, but let’s keep an eye on wages.

Retail, too is a big employer here – essentially meaning that low paying jobs are a big employer here. We have about 5000 people in manufacturing (and MBIE’s projection indicates there will be NO increase in retail employment over the next two years).  Let’s hope our manufacturers don’t take their factories and jobs elsewhere. As for high paying jobs in mining, information media, electricity, gas and financial services: combined, fewer than 3000 people are in those high-paying jobs in this region. WDC is confident, though, about industrial opportunities bringing jobs and settlers to places like Marsden point, with up to 18,000 work opportunities and 40,000 people projected, according to the area’s Structure Plan.

Housing: In the last PropertyPlus we revealed the median house price in Northland is a record $450,000 – that’s a $30,000 increase on the Northland median just since April, and a $100,000 increase in the median compared to May 2016. So our housing prices are indeed booming. That’s great for sellers, good for people who currently own a home and won’t sell for ages, and slightly challenging for people looking to buy – such as economic migrants coming here for work who are facing a rising median price but declining numbers of properties for sale compared to last year. 

As for mean weekly rent, it’s at an all-time high, too, at over $350 mean weekly rent. Great for economic migrants looking to halve their rent bill after Auckland, but not so good if our people have the lowest median household income in the country.

Construction: Loads of building consents mean an economic boom, the ASB Scoreboard report authors argue, because the total value of building consents for residential and non-residential hit a ten year high in quarter four 2016. Okay – maybe. The one building which really pays for itself by generating ongoing tourist dollars – the Hundertwasser Art Centre – just narrowly squeezed through and now has the funds for construction to commence. Whew!

Anyway, let’s be cautious about the significance of high house prices and high rents, because those figures aren’t good news for the many people up here who are disadvantaged. 

Michael Botur has published journalism in NZ Herald, Herald on Sunday, Sunday Star-Times and Mana and he writes a lot of fiction. He moved to Whangarei in 2015 and was ecstatic to be able to afford a house here.


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