Figures released by Statistics New Zealand today showed that the economy grew by 0.7% ending the very deep recession seen over the past year, said NZCTU Te Kauae Kaimahi Economist Craig Renney. “Even though GDP grew in the three months to December, our economy is still 1.1% smaller than it was in December 2023. Unemployment is up. Annually, business Investment is falling. We are still very far away from being back on track.”
“While any economic growth is welcome, this data further demonstrates the compelling need for an actual economic plan, not just a few slogans. One based upon growing both public and private investment. One based upon growing wages and household incomes. Many might celebrate this economic signal, but that one note needs to be put in context. Unemployment is up. Child Poverty is up. Homelessness appears to be rising. Our economic challenges are still very much here and worse than they were a year ago,” Renney said.
“The GDP data now shows that our GDP per capita fell 2.2% from last year. GDP per capita is lower than it was in 2021. On quarterly basis, it increased by 0.4%, not enough to offset recent falls. Real household spending on durable goods, which is a key measure of consumer confidence, was 2.6% lower than December 2023.
“GDP data also shows that the wages rose far less quickly than profits – asking questions about where the benefits of this growth are going. Across the economy, the broad measure of wages (compensation of employees) rose 1.7% last year. The broad measure of profit (Gross operating surplus and gross mixed income) rose 5.7% – or 3.3 times the rate of wages. If there is a recovery, it’s not yet ending up in workers pockets,” said Renney.