The historically high number of New Zealanders currently emigrating to Australia, especially from Christchurch, could see labour shortages emerge and hamper reconstruction after the spate of earthquakes in the city over the past 10 months, says Moody's.
Katrina Ell and Fred Gibson, associate economists at Moody's Analytics (a sister company of credit rating agency Moody's Investors Service) in Sydney, say they expect the New Zealand economy to have contracted 0.2% quarter-on-quarter in the first (March) quarter this year. Statistics New Zealand is due to release the number tomorrow. They also note that migration to Australia in May was the highest for a May month in more than 30 years.
"Christchurch residents were a high proportion of movers," Ell and Gibson say. "It is hardly surprising that workers from Christchurch are seeking employment abroad when anecdotal reports point to construction workers not receiving payment for jobs."
"Given the expectation of a surge in demand for such workers when reconstruction efforts begin later in the year, this could inhibit recovery efforts."
According to Statistics New Zealand, a net 3,312 people permanently departed from New Zealand to Australia during May, surpassing the previous May record of 2,900 set in 1979. Departures of Christchurch residents totalled 800 in May, up from 500 in May 2010. Since the devastating earthquake on 22 February that killed 181 people, the city has experienced 1,300 more departures and 400 fewer arrivals than in the same period of 2010, Statistics NZ says.
Fletcher Building CEO Jonathan Ling, whose company has a key role in the Christchurch rebuild, recently told interest.co.nz that the rebuild can't get properly underway until the aftershocks tormenting the city come to an end. Ling said the actual physical rebuild, once it could get underway, wasn't a complex job and the workforce, contractors and materials were ready to go.
The economy grew 0.2% in the December 2010 quarter.
3 Comments
FYI, Stats NZ has delayed release of the GDP figure till July 14.
Statistics New Zealand has delayed the release of the Gross Domestic
Product: March 2011 quarter (GDP) information release until Thursday, 14
July.
GDP was due to be released on Thursday, 7 July but more time is needed to
analyse the data.
Statistics NZ previously announced that the release of the March quarter GDP
would be delayed from 23 June until 7 July. We needed this extra time to
ensure that our methods for measuring GDP adequately accounted for the
Canterbury earthquakes, and to get supplementary data for the March quarter
release.
The quality assurance work for the March quarter has taken longer than
expected and we have now decided that another week is required to ensure the
quality of the results.
"We regret the inconvenience to people who use GDP information," Colin
Lynch, Deputy Government Statistician for macro-economic and environment
statistics said.
"Statistics New Zealand is committed to providing timely information.
Because of this, the results of GDP are finalised very close to the release
date. In this case, it means we have had to make the decision to postpone
close to the scheduled release date."
Given the sensitivity of GDP data and the stage of analysis, Statistics NZ
will not make any further public comment before the release on 14 July.
And with Moody's announcement the cost of labour can be jacked to the roof. It will not be the only thing to cost a dam sight more. Expect freight -steel- cement- wood- glass- aluminium- fees- council charges- gib board- wiring- fittings plus carpets and tiling to all go up in price....plus gst of course. Oh did I leave out roofing...silly me...always one of the first move up isn't it.
Meanwhile the govt will look the other way. The RBNZ will claim inflation is under control. But across the regions building activity will take a second bashing as those who thought building might be a good idea will say "to hell with this".
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