Canterbury Economy and Labour Market
Overview of the Canterbury economy
The earthquakes in 2010 and 2011 disrupted economic activity in Canterbury and initially led to a negative impact on the labour market. Demand from industries driving the subsequent rebuild has brought about strong labour market conditions compared to other parts of New Zealand. This growth has seen Canterbury move ahead of the Wellington region to become the country’s second largest economy, according to the Statistics New Zealand March 2015 estimates. For more information about key indicators for the Canterbury economy see the Regional Economic Activity Report. Scroll down the page to see the range of indicators available.
Canterbury has experienced stronger GDP growth than in the rest of New Zealand from 2013 to 2015 due to the rebuild ramping up. This economic growth is expected to continue, but at a more modest level, now that the rebuild activity has plateaued. As the residential part of the rebuild nears completion, the focus has shifted to commercial construction. Alongside construction, other important industries in the Canterbury economy are Manufacturing, Professional, Scientific, Technical, Administrative and Support Services, and Owner-Occupied Property Operation.
In the future as rebuild activity reduces, the region will need to rely on more traditional areas of its economy such as manufacturing and agriculture, as well develop new areas of growth, such as those that will be catalysed through the Christchurch Innovation Precinct.
The number of people leaving the Canterbury region has eased and is now at a similar level to before the September 2010 earthquake.
Statistics New Zealand’s annual regional population estimates show, for Canterbury, that, in the last 12 months (in the year to June):
- The population loss in Canterbury and Christchurch is slowing.
- Christchurch’s population fell by 4,600 (1.2 percent) in the year ended 30 June 2012, while Selwyn district has experienced the largest population growth for any territorial authority, expanding by 2.9% in the year.
- Canterbury region’s population decreased by 1,800 people (0.3 percent).
- In the past 2 years, Canterbury’s population under 20 has fallen by 5.7 percent while the population aged 35-49 has fallen by 5.5 percent. This suggests an outflow of children and their parents from the region over the period. For more information click here.
Interestingly, the older population seems to be staying put, with the population aged 65+ increasing by 5.3% over the past 2 years.
Overview of the Canterbury labour market
Due to the rebuild activity Canterbury has experienced higher employment growth and a lower unemployment rate than the rest of New Zealand since 2012. Since mid-2013 the unemployment rate in Canterbury has been below 4 per cent.
There has been stronger growth in the demand for labour in Canterbury than in the rest of New Zealand since 2010. The most vacancies are in the construction industry, though many other related service occupations have also received a boost. For more information about the rebuild related job market see the Quarterly Canterbury Job Matching Report. See Jobs Online for information about recent job vacancies in the region.
Wage rates in most industries in Canterbury are increasing at a pace that matches the rest of New Zealand. Since 2011 the construction industry in Canterbury has experienced stronger wage growth than in the rest of New Zealand. This has now slowed, but wage rates for the construction industry are still higher in Canterbury.
Job opportunities exist all throughout the Canterbury region, not just within Christchurch itself. Agriculture is central to the Canterbury economy, creating seasonal work opportunities throughout the region, with some farms and vineyards desperate for low-skilled workers. For more information about specific skill shortages see the Skills Shortage List, and the Short-term Employment Forecasts for more information about future employment demand.
Demand for labour is growing
The Canterbury region will need a broad pool of workers to sustain the construction work. Advertised vacancies in the Canterbury region have increased dramatically over the past 18 months (see Figure 1), compared to other regions. Some of this increase will be due to new jobs being created and some due to turnover as a result of people leaving the region.
Growth in job vacancies in Canterbury was driven by the construction and engineering industry (up by 108.4%) as the Canterbury rebuild continues to boost demand for workers.
Occupations in demand
The Canterbury rebuild will require many thousands of additional construction workers at its peak. The most in demand construction-related occupations are carpenters and joiners, paint trade workers, plasters and concreters.
The rebuild is likely to occur over many years. Such factors as continued aftershocks have reduced the prospects of a quicker rebuild. The largest component of the construction effort relates to rebuilding and repairing the many thousands of residential properties. The extensively damaged CBD may also take many years to rebuild. In contrast, land remediation and infrastructure repair are well underway. Both will require fewer, more specialised workers.
While construction workers dominate the required labour pool, a wider pool of talent is required. This supporting cast includes support staff and services workers. The economic stimulus that will follow the arrival of new workers will in turn drive employment growth in other sectors like hospitality.
There are early signs of that upturn in the growth in vacancies across industries in Canterbury, as shown in Figure 2.