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Services
The service sector incorporates a wide range of industries including wholesale and retail trade, restaurants and hotels, transport, communication, finance and community and personal services. In total, this group accounts for almost half of all economic activity in the City. Estimated GRP for the sector increased by 4.5 percent in the year to March 1996 and by more than 20 percent since 1992. This economic growth has been accompanied by substantial increases in employment. The latest figures show service sector employment increasing by 4.2 percent in 1994/95 and a further 5.2 percent in 1995/96. The expectation is that this growth will continue during the 1996/97 financial year (Figure 3.18).
Source: Statistics New Zealand; GRP Estimate - Christchurch City Council
Activity across the sector has been boosted by the general increase in production occurring in other sectors, by increases in employment and subsequent growth in disposable income within the local economy, and by the flourishing tourism market.
Retailing
Retail spending appears to be growing strongly again after stalling during 1994/95. In real terms retail spending in Christchurch has increased by 7 percent during the year to June 1996. While we are not able to make long term comparisons of retail spending in Christchurch due to the non-availability of appropriate statistics retail spending for Canterbury has increased by a third since the recessionary low of June 1991 (Figure 3.19).
Source: Statistics New Zealand
The City remains well positioned to take advantage of the expected improvement in economic conditions forecast for the remainder of this decade. The NZIER predicts retail sales will continue to grow in 1996/97 particularly in the non-durable and service sections of the industry. Employment and tourist growth combined with rising disposable income as a consequence of the second round of tax cuts will boost retail activity in 1996/97. When the Reserve Bank regains control of underlying inflation these influences will be supported by falling interest rates and lower inflation.