Welcome back to our Weekly Digest. Read on for the latest updates and some ideas to help us all move forward.
Booster Roll-out Update
Boosters and the newly available children’s COVID-19 vaccine have led to a surge in vaccination dose rates in the last week. New data showed that in just six weeks since the beginning of December, nearly 22% of people aged 18 or over have already had a booster.
By the end of February, more than 82% of vaccinated New Zealanders will be eligible to get their booster dose. Meanwhile, children aged 5-11 are eligible to get their first dose of the pediatric Pfizer vaccine from Monday this week.
Q4 Business Outlook and Demands Weakens
Business confidence and demand dropped in the fourth quarter of last year, with a net 28% of firms surveyed expecting general business conditions to deteriorate compared with 11% pessimism in the previous quarter, according to the New Zealand Institute of Economic Research’s quarterly survey of business opinion.
Inflation pressures are accelerating, and labour shortages due to pandemic restrictions are underpinning a lift in wage growth. This increase leads to higher costs for businesses, with a net 61% reporting higher costs in Q4– the highest level since June 2008.
Home Prices Drop in December
House prices dropped 0.3% in December over the previous month and rose 22% year-on-year, according to the Real Estate Institute of New Zealand. The impact of rising interest rates, tighter lending criteria, and changes to investor taxation restrictions are the reasons for this change in dynamics.
Construction Declines, But Residential Expected to Drive Growth
The economy recorded its second-largest quarterly contraction since current records began in Q3 2021 due to the limits in economic activity as a result of the Alert Level 4 lockdown. The restrictions also weighed heavily on construction activity, with the value-add of the construction sector declining to $4.2 billion in the quarter– a contraction of 9.6% quarter-on-quarter and 11% year-on-year.
However, growth is expected to be driven by the volume of residential building. Between January and October 2021, consents were up 26.1% year-on-year.
Support available to you
Work and Income has a Find COVID-19 Support tool to help you find the support options you’re eligible for.
Change in Leave Support Scheme
The Leave Support Scheme is now a weekly payment, instead of a two-week payment amid the change in the periods of self-isolation.
This scheme is available to employers and the self-employed to help pay their employees who have been advised to self-isolate because of COVID-19 and can’t work at home during that period.
The COVID-19 Leave Support Scheme is paid at the rate of:
- $600.00 a week for full-time workers who were working 20 hours or more a week.
- $359 a week for part-time workers who were working less than 20 hours a week.
You can learn more about it here.
Events Transition Support Scheme Launched
The Events Transition Support Scheme opened last week, covering 90% of unrecoverable costs for major events cancelled or postponed due to the pandemic. It will apply to live, in-person paid events with over 5,000 attendees from 17 December until 3 April 2022.
Small Business Cashflow Loan Scheme
If you employ 50 or fewer staff, you may be able to apply for the Small Business Cashflow Loan Scheme. This is a one-off 5 year loan where you can borrow a maximum of $10,000 plus $1,800 per full-time-equivalent employee within your business.
- When applying for the loan, you need to be able to declare that your business is viable.
- Your business must have experienced a minimum 30% decline in actual or predicted revenue over the period of a month, compared with the same month last year.
- Applications are open until 31 December 2023 through myIR. If your business does not have a myIR account, you will need to create one to apply.
Loans will be interest free if they are paid back within 2 years. The interest rate is 3% for a maximum term of 5 years.
COVID-19 Short-Term Absence Payment
The Short-Term Absence Payment is available for businesses, including self-employed people, to help pay employees who cannot work from home while they wait at home for a COVID-19 test result. This is a one-off payment of $359 for each eligible worker. You can find the details here.
Kiwi Business Boost Tool
The Government has funded specialist consultancy support services to provide advice to businesses who need it. You can use the Kiwi Business Boost Tool to find out what services are available in your region.
The Treasury website’s COVID-19 Economic Response Measures can also provide more information on the range of support available to businesses.
Get in touch
Contact us if you have any questions or want to discuss the next steps for your business.