There are many signs the New Zealand economy is weakening after years of stellar growth. This trend should worry us all. It means fewer jobs, lower living standards and less revenue for Government to provide healthcare, education and superannuation.
Business confidence in New Zealand has plummeted to the lowest level in ten years, while Australia’s is at a ten year high. The OECD that includes the 35 developed countries in the world like the US, UK, Canada, Japan etc has us falling from second best last year to second worst now. We have pulled into the slow lane with 33 countries passing us.
Businesses lacking confidence do not employ or invest. There were 10,000 new jobs being created per month in 2016 and 2017. It has dropped 60% to now 4,000 per month. Unemployment had been consistently dropping for years but it is now going up again. Nelson unemployment was 2.2% when National left office but is now at 4.7%.
Trouble is also brewing in our productive industries. Farmer’s confidence has fallen 66% and horticulturalists by even more. We have seen four large building companies nationally go broke in the last month, putting hundreds out of work and creditors further down the line, out of pocket.
These economic woes are in turn seeing a return of the brain drain. We had 30,000 kiwis leave for Australia a year back in 2008, with most being our best and brightest. Last year it reversed with a nett gain for New Zealand of 1,000. This year’s figures show the tide turning back and kiwis leaving again.
These economic troubles are the product of the Government putting up taxes, increasing union powers, putting extra costs on businesses and shutting down whole industries. We are a country of small businesses, with 97% of enterprises employing less than 20 people. Small businesses have been particularly hard hit with extra costs such as increased fuel taxes and the new 10 day leave requirement for domestic violence victims. While extra help for victims of domestic violence is welcome, dumping the cost for every society woe on businesses is unfair. Meanwhile, the hundred plus reviews across almost every sector from electricity to transport and rogue Ministers taking cheap pot shots at business leaders like Fonterra and Air New Zealand is not helping.
The state of the economy is wide reaching and affects us all. While it is cool having a new young Mum as PM, it is no substitute for good governance and a strong economy. We need the PM, now back from maternity leave, to recognise these serious problems, get her Ministers listening and for the Government to change tack.