Nelson Tasman Economic Forecast Paints a Grim Picture
Posted on Wednesday 13 May 2020
Project Kōkiri, the regional response collaboration to the COVID-19 pandemic, have just released a report on the anticipated economic impacts on the Nelson Tasman Region.
“The purpose of this report was to gather good independent data for the region to provide a common basis for decision making and understanding the landscape as the region progresses through response and recovery”, says Mark Rawson, Chief Executive of the Nelson Regional Development Agency. The report has been prepared by Infometrics and was commissioned by the Nelson Regional Development Agency on behalf of Project Kōkiri.
“Some of these forecasts make for sobering reading but it’s important we have an honest conversation about the significant economic fallout we are likely to face. Our region has some significant competitive advantages that will help us navigate these changing times but we need to be realistic about the storm we are facing and put ourselves in a position to respond accordingly.”
“We wanted to understand the early estimates of the economic impact of COVID-19 as we build a regional Restart and Recovery Plan through Project Kōkiri, but also to help local businesses as they navigate their own response planning”.
The report is based on early forecasts based on a range of assumptions of the most likely outcomes for the different sectors of the Nelson Tasman economy over the year to March 2021.
Some of the key estimates from the report include:
- Nelson Tasman’s economy will decrease by 7.9%
- Almost 1 in 10 jobs are expected to be lost, with unemployment rising to 8.6%
- The highest number of job losses will be low-skilled (46%) and there will be a larger effect on Māori employment.
- Earnings across the region will decline by $280m.
- The hardest hit industries will be transport, retail and accommodation, of which the tourism sector makes up a large proportion of.
- The region’s strong primary production and manufacturing sectors will improve the region’s resilience.
- The construction sector is forecast to decline sharply in the short-term, but is likely to provide some support for economic recovery from 2023 onward.
The report also provides some thoughts on economic recovery over the medium term. These include an opportunity to build on the region’s strong lifestyle proposition as well as the importance of skills development and infrastructure construction in the recovery.
“We need to work together towards a strong economic recovery and the first step in any recovery is knowing what we are facing. This report confirms that the people of Nelson are hurting and there is no quick fix to the financial challenges ahead for the region. Now is the time to dig deep, and draw on that resilient spirit that saw this community cope so well with lockdown. That was hard, this will be harder, but if we work collectively, making decisions based on the best available data then we can rise to this challenge.” Said Nelson Mayor Rachel Reese.
“The report shows there will be a significant impact to our economy. However, it also highlights the fact that we have a lot of advantages in our region that put us in a good place to recover. It’s anticipated that there will be a big impact on tourism, but a lesser impact on other industries and the diverse economy of our region means we’re in a much stronger position.
In order to make the most of those positives, everyone needs to work together and recovering will require a collective approach and combined effort from the community, central and local government, and the private sector. Things will be different, we are going to have to work differently but this brings positive opportunities. Supporting local business and local industry will be important. Hopefully we can show leadership at a regional level that will support national recovery across all of Aotearoa”, says Tasman Mayor Tim King.
The full report is available to view here.
Infometrics Webinar - COVID-19 and its effects on Nelson-Tasman
Monday 18 May, 3-4pm
Join economists from Infometrics and Mark Rawson, CEO of the Nelson Regional Development Agency for a briefing on the report and gain a more in-depth understanding of the local economic effects of the COVID-19 pandemic on the Nelson Tasman region. There will be an opportunity for Q&A.
About Project Kōkiri
Project Kōkiri is a collaboration between Nelson Regional Development Agency, Nelson Tasman Chamber of Commerce, Tasman District Council and Nelson City Council. The focus is on leading the region’s Economic Restart and Recovery planning – linked into the other aspects of the response and enabling economic stimulation.
Project Kōkiri will be leading the conversation around building a more resilient and sustainable economy for Nelson Tasman moving forward. Using the intergenerational vision and outcomes designed by the community during the Te Tauihu Intergenerational Strategy process.
Project Kōkiri is being led by a Leadership Group headed by the two mayors and including some key local business leaders, iwi, and government stakeholders. The leadership group is supported by a Project Action Team who are focused on enabling restart and recovery initiatives.