We are excited to launch an expansion of our Quarterly Economic Monitor (QEM) to provide a broader perspective on the prosperity of New Zealand’s communities. In this article, we introduce and explore the 13 new indicators which reflect economic, labour, social, and housing outcomes at a local level.

Other benefit recipients have been added to the QEM to complement Jobseeker Support, which has been in the QEM for some years. Other benefit recipients include Sole Parent Support, the Supported Living Payment, and others. Jobseeker Support is influenced by the labour market – it tends to go down when the labour market is tight and go up when jobs are more scarce.

As Chart 1 shows, other benefit recipients are less influenced by the labour market, exhibiting a different trend to Jobseekers. However, other benefit recipients remain a large number of supported households, and so are increasingly important to monitor.

However, many people receiving other benefits could be employed if employers were willing to be flexible and accommodate their needs. For example, anyone that is totally blind automatically qualifies for the Supported Living Payment – however, totally blind people can work in many roles, especially if they are supported with a willing employer and appropriate equipment. Similarly, sole parents can enter employment, especially if appropriate part time opportunities are available, such as Sealord in Nelson running a 9am-2pm shift to suit parents. Considering these groups who have in some cases been left at the margins of the labour market, is a win-win, as it boosts incomes for those who need it most, and can provide a solution to labour shortages.

Our Regional Economic Profile provides more granularity within other benefits – showing the trend for Sole Parent Support, the Supported Living Payment, and other main benefit.

Business counts reflect the number of open businesses across the country. Stronger business growth will generally align with better business conditions and spending activity, when there are more opportunities to produce a successful business. Lower business growth will happen when business conditions are more challenging, and entrepreneurs struggle to find a market opportunity.

Business counts provides a complementary perspective on local economies alongside GDP and employment. GDP and employment can be heavily influenced by large businesses, and by contrast businesses counts are more influenced by small businesses, as businesses small and large are counted equally. As Chart 2 shows, following on from the closure of the Marsden Point Oil refinery, Whangārei’s GDP fell sharply in 2023, however, employment continued to grow, and business count growth accelerated faster than the national average. Growth of business counts ahead of employment could indicate growth in smaller businesses.

EV registrations complement our long-standing car and commercial vehicle registrations indicators, which can indicate household and business confidence respectively. EV registrations count first-time registration of new and used battery electric cars, excluding hybrid, plug-in hybrid, or fuel cell cars. EV registrations reflect the adoption of more sustainable transport options by households in each area and can be used to help understand demand for charging infrastructure.

EV registrations will be an interesting indictor to watch over 2024 as a number of changes affect the market for EVs. The clean car discount scheme was tweaked in July 2023, and shut down in December 2023, led to a surge in EV registrations at the end of 2023 (see Chart 3).

Road user charges are being implemented for EVs from April 2024, which give EVs less of an advantage in operating costs compared to internal combustion vehicles. These factors all significantly distorted the vehicle market, so expect a lull in EV registrations through starting in the March 2024 quarter.

The NEET rate indicates the proportion of 15-24 year old residents who are Not engaged in Education, Employment or Training. We have published NEET rates in our Regional Economic Profile for several years, but we have now upgraded our model to estimate NEET rates on a quarterly basis. Our NEET rates are benchmarked on regional NEET rates from the household labour force survey (HLFS). The overall unemployment rate reflects the proportion of people available and actively seeking work who are out of employment. The NEET rate reflects not just unemployment among youth, but also broader social issues such as disengagement and transiency. In other words, NEET reflect not just the availability of jobs and training, but the readiness of youth to engage in jobs and training, which often requires additional support.

Chart 4 shows NEET rates for Auckland and New Zealand over time, showing that the COVID-19 pandemic and subsequent lockdowns hit Auckland harder than the rest of the country. Auckland’s NEET rate tracked below the national average up to 2019, rising to a peak of 14% in 2021, compared to 13% nationally. NEET rates in Auckland and nationally converged at a historically modest 11% at the start of 2023, however, rates started to increase again towards the end of 2023, reflecting a broader rise in unemployment.

Our school attendance indicator is based on school attendance reported by schools to the Ministry of Education. This result is presented as the proportion of school students who attend greater than 90% of their classes. Some individual students have legitimate absences which bring their attendance to below 90% but are still counted in this measure as the aim is to reflect overall trends in school attendance. Because there is no distinction between justified and unjustified absences, this indicator should not be taken as a proxy for truancy.

School attendance rates have been through a tumultuous period over the past decade, falling from a peak of 69.5% in December 2015, to 63.5% in September 2019, ahead of the pandemic. Attendance fell to an all-time low of 45.5% in December 2022, reflecting the effect of the Omicron outbreak in the community, a shift in attitudes around attending school when sick, and issues around lingering youth disengagement after the pandemic. Given this context, school attendance is best interpreted on a relative basis – is it improving over time, and how does it compare to other areas?

Attendance data comes out with a substantial lag compared to most other indicators in the QEM, and we will update this indicator as the data becomes available.

The crime rate has been included in our Regional Economic Profile wellbeing framework for some time, on an annual basis. We’re now including the quarterly rolling crime rate in the QEM to help users keep a closer eye on crime trends. Crime is expressed as the number of proceedings per 10,000 residents per year. This relative measure means that small and large areas can be fairly compared. Crime often reflects a interaction between structural and temporal factors – high socioeconomic deprivation is associated with high crime, and this may be exacerbated by economic downturn causing unemployment and financial hardship.

The crime rate has been trending down for much of the past 8 years, although it has picked up slightly over the past two years. In considering the crime rate, it’s important to reflect that it only records reported crime. The crime rate captures a full breadth of crime, so trends in particular demographics or types of crime which feature in the media, such as youth stealing cars and ramraiding, may not directly appear and influence overall crime trends.

For now, the crime rate counts all types of crime equally. However, we are keen to explore issues of crime severity in future, so that for example, serious crimes like murder are weighted more heavily than less serious crimes like theft.

Our new gambling series uses gaming machine proceeds as a proxy for gambling activity. This measure tallies the profits from pokie machines in pubs – which effectively measures the amount of money taken out of communities by pokies, before considering what is returned in the form of community grants. Gambling reflects a combination of structural socioeconomic factors and current economic conditions. Gaming machines are more likely to be found in areas with higher levels of socioeconomic deprivation. Chart 7 shows gambling proceeds as a share of total household incomes, led by Kawerau District where gambling proceeds amount to 1.3% of total household incomes.

Rents presents the mean weekly rent based on bonds lodged with MBIE. This indicator was previously presented in the REP – but now we are presenting this on a more timely basis. This data can be useful for seeing recent trends in rents, or just grabbing the latest rent values to use in understanding housing needs or for marketing materials for businesses or potential residents.

As Chart 8 shows, average rent has increased to $550pw across New Zealand, with higher rents in Auckland, Wellington, and Bay of Plenty.

The recent burst in international net migration to New Zealand has prompted record population growth, which has added heat back into the rental market and helped push rents up 6.0% over the year to December 2023 nationally.

Real estate listings measure the number of new listings for residential dwellings on realestate.co.nz. It is based on the number of listings added to the site each quarter or year. This measure complements our indicators of house values and sales. In particular, comparing trends in listings with sales indicates whether there is a shortage or surplus of listings – and how this dynamic might influence house values. Chart 9 shows that in Auckland, sales grew far faster than listings over 2020 and 2021, before entering a glut in 2022 and 2023. Towards the end of 2023, we see sales picking up faster than listings again, suggesting a shortage of listings in the region.

Our first home buyers measure is based on data from Kāinga Ora on the number of properties bought using a First Home Grant. The First Home Grant offers eligible first-home buyers with a grant of up to $5,000 to put towards the purchase of an existing/older home, or up to $10,000 to put towards the purchase of a brand new property.

This measure doesn’t capture all first home buyers, as some will be excluded by First Home Grant eligibility requirements including maximum annual income and house price caps. The house price caps vary by territorial authority – in some areas the cap is well below the average house value, meaning that relatively few first home buyers make use of the grant for existing properties. A more generous house price cap applies to new build properties.

Emergency housing grants measure the number of households receiving emergency housing grants from MSD, which reflects households living in motels or similar temporary housing arrangements. Households living in emergency housing could be on the Housing Register and waiting for public housing to become available, and/or trying to find a suitable private market rental.

Chart 11 shows the trend of households in emergency housing over time for selected territorial authorities. This chart shows that most areas have experienced a decrease since the March 2022 quarter, most notably Rotorua and Hastings Districts. Both areas have manged to bring down the use of emergency housing through concerted cross-organisational efforts, including better supporting those in emergency housing and growing supply, including public housing and papakāinga.

The Housing Register, often referred to as the public or social housing waiting list, counts applicants who are not currently in public housing, who have been assessed as eligible for public housing and who are ready to be matched to a suitable property.

Data is sourced from the Ministry of Social Development (MSD) and is shown as the average number of applicants on the Register. One applicant could represent a single person, a couple, or a family looking for housing. Applicants could be living in emergency housing, unaffordable private rentals, or other insecure arrangements such as couch-surfing or rough-sleeping.

This measure should be read in conjunction with public housing, which measures the number of public houses (stock).

Public housing includes properties that are owned or leased by Kāinga Ora and other registered Community Housing Providers (CHPs) that can be tenanted by people who are eligible for public housing. The totals presented include both occupied and vacant houses. Public housing was previously referred to as social housing. This data is sourced from the Ministry of Housing and Urban Development.

Taking Palmerston North as a fairly typical example, Chart 12 shows strong growth in the number of households on the Housing Register over 2019 to 2021, with no corresponding increase in the public housing stock over this period. Concerted efforts to grow the public housing stock over 2022 still pale in comparison to the scale of the Housing Register.

The gap apparent here clearly illustrates the scale of our housing challenge – which can be only be dealt with through concerted efforts on all fronts – growing public housing stock, increasing availability of affordable private rental housing, better employment opportunities, and more.

The 13 new indicators are available in our Quarterly Economic Monitor as of Thursday 29th February for current subscribers. A number of areas have a public QEM, provided by local councils or economic development agencies.

To enquire about access to the QEM, or if you’re an existing client with any questions about the Quarterly Economic Monitor, please contact us.