Manufacturing and wholesale sector emerges as bright spot for NZ economy

Manufacturing and wholesale is emerging as one of the bright spots of the New Zealand economy as the sector posted big revenue gains, despite difficult economic conditions and continuing pessimism about the pace of the economic recovery, according to a new study. The MYOB Business Monitor, a regular survey of over 1000 small and medium enterprises, found that the manufacturing and wholesale sector had the most revenue gains of any business group over the last 12 months. In 2011 44 percent of businesses in the sector reported revenue rises.
Looking at 2012 revenue forecasts, manufacturers are also the most positive about their prospects, with 57 percent expecting revenue growth over the next 12 months. Just 3 percent of businesses in the sector expected their revenue to fall, the lowest of any sector surveyed. This optimism is being fuelled by reports of just over half of manufacturers indicating they have more work in their sales pipeline for the next three months (April to June 2012).
MYOB General Manager Julian Smith said: “What this survey shows is how important the manufacturing and wholesale sector is to the New Zealand economy, as it continues to grow and succeed despite some very difficult economic conditions. To see such strong growth at a time when many other sectors are struggling highlights the huge contribution the sector is making.” Much of the sector’s strong showing over the past year has been driven by positive results from the Auckland region, where 54 percent of businesses in the sector were reporting revenue gains. Christchurch’s manufacturing and wholesale businesses also performed well, with 40 percent reporting an increase in revenue.
However, manufacturing businesses in the Wellington region are not performing as well, just 20 percent of business owners were reporting gains in the region, while 56 percent reported losses. Manufacturing emerged as a strong driver of employment, with 22 percent of businesses in the sector planning to take on full-time staff in the coming year and 23 percent with plans to hire more part-time staff, the highest of any sector in the country. “The manufacturing and wholesale sector is really emerging as a bit of steel in the spine of the New Zealand economy, propping up growth and hiring at a time when the economy is not recovering as fast as we would like to see. It’s very encouraging to see expected job growth in the sector is so high over the next 12 months, which will be a real boon to New Zealand job-seekers,” said Mr. Smith.