WELLINGTON: More Aucklanders are working and they are earning more than people elsewhere, with the city in the midst of a significant economic growth phase.
The latest Auckland Economic Quarterly from Auckland Council’s chief economist Chris Parker identified the city’s growth across various economic indicators including job market expansion, wages, immigration, retail spending and construction. But it also raised concerns about high house prices.
The report showed Aucklanders’ real average wage now stands at $1166/week, ahead of the rest of New Zealand’s $1084/week. Auckland wages are also rising, albeit marginally, from $1164/week in last year’s fourth quarter to $1166 in this year’s first quarter. Auckland employment numbers rose from 782,000 at last year’s fourth quarter to 797,000 by this year’s first quarter.
But Auckland’s median house sale price had hit $755,000 by Jun, according to the Real Estate Institute, compared to $450,000 for the rest of New Zealand and Parker said that remained an issue.
“Auckland’s housing market still dominates debates and it has even been described as the major political issue of not just the year but maybe of this decade,” Parker wrote. However, Auckland is doing well economically. “The Auckland economy continues to grow strongly. Auckland’s GDP is up 3.7 per cent over the year to March 2015,” the quarterly stated.
“This is driven by strong investment, spending and employment as increased international net migration boosts demand. Strong hiring growth underpins Auckland’s economic performance with employment growth at 5.2 per cent on the year.”
Auckland’s net annual migration is at historic highs of 26,800 as at June, up from a low of 4000 in January 2013.
“The increase is driven in equal measure by a reversal of the transtasman brain drain and higher number of Europeans on work visas and students moving into Auckland,” the quarterly said. More people are spending more too: retail spending grew up 6.4 per cent for the March year. And the outlook is for the good times to continue.
“The lower exchange rate, increasing construction demand and high net migration are expected to sustain Auckland’s growth for a while yet.” Building consent numbers rose to 8195 for the May year, up 21 per cent for the same period a year ago.
The quarterly pondered the dramatic drop in dairy prices indirectly flowing through to Auckland’s economy during the next 12 to 18 months but said a falling dollar was good for the city’s export and tourism sectors. Auckland tourism guest nights rose from 6.9 million in December to more than 7 million by May.
