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Economic Development Committee
3 September 2019
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Part
A Reports
Dunedin City Quarterly Economic Monitor Report
- June 2019
Department: Enterprise Dunedin
EXECUTIVE SUMMARY
1 Economics
consulting firm, Infometrics has been commissioned to provide quarterly
economic monitoring reports for Enterprise Dunedin.
2 The
purpose of the report is to provide Enterprise Dunedin and the Economic
Development Committee with an update of progress against the 2023-2023 Economic
Development Strategy and overview of the Dunedin economy.
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RECOMMENDATIONS
That the Committee:
a) Notes the Dunedin
City Quarterly Economic Monitor Report – June 2019
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BACKGROUND
3 Enterprise
Dunedin activity is informed by the 2013-23 Economic Development Strategy
('strategy'). The strategy is underpinned by five themes:
a) Business
vitality – to improve the ease of doing business.
b) Alliances
for innovation – to improve linkages between industry and research.
c) A
hub for skills and talent – to increase retention of graduates, build the
skills base and grow migrant numbers.
d) Linkages
beyond our borders – to increase international investment and establish
projects with other cities.
e) A
compelling destination – to increase the value of tourism and events and
improve the understanding of Dunedin’s advantages.
The Strategy sets out two economic goals:
· 10,000
extra jobs over 10 years (requiring employment growth of approximately 2% per
annum).
· An
average $10,000 extra income for each person (requiring GDP per capita to rise
by 2.5% per annum).
DISCUSSION
4 The
attached report provides the following insights into the Dunedin economy:
a) Dunedin’s
unemployment rate fell to 6.0% in June 2019, down from 6.6% a year ago.
Although unemployment remains above the national average, recent improvements
suggest that employers are beginning to have the confidence to invest in their
enterprise by taking on new staff.
b) Two major factors appear to be behind the higher rate
of unemployment over the recent years:
· Longstanding hollowing
out in Dunedin’s manufacturing sector has continued. In addition, those
employed who have lost manufacturing-related jobs do not necessarily have
skills that were readily transferable to industries that were gaining jobs,
such as professional services.
1
· A skills mismatch
between job seekers and the types of jobs that were created. With net migration
of 4,300 and employment growth of 3,469 between 2015 and 2018, it’s
plausible that workers moving to Dunedin filled the bulk of new jobs.
2
c) This skills mismatch is something that takes time to
solve as people must retrain or develop new skills. Some of those that have
been unemployed may also be forced to eventually take more elementary positions
in new industries than they had originally hoped for.
d) Despite a recent decline in the unemployment rate, the
number of people gaining access to Jobseeker Support crept up marginally over
the June 2019 year. Government policy remains part of the reason for this
divergence, with less stringent welfare policies increasing the number of
people accessing Jobseeker Support. Encouragingly for Dunedin is that the 0.7%
increase in those seeking Jobseeker Support is significantly less than the 9.6%
national increase.
e) Provisional GDP estimates for Dunedin showed growth of
2.3% in the June 2019 year, close to national growth of 2.5%.
f) A 4.2% increase in the number of people enrolled with
local health providers indicates a further acceleration in population growth.
This highlights an ongoing stream of people choosing Dunedin as a place to
live, work, study and do business.
g) Population growth has put upward pressure on house
prices and sales. Homebuilding has pushed higher in response to this demand,
although challenges remain accessing construction staff given building activity
remains high across the region.
h) Dunedin is likely to be insulated from economic
uncertainly, by large scale infrastructure investment that will shortly get
underway. For instance, the government has allocated $1.4bn to the Dunedin
hospital rebuild, with more than 1,000 workers expected to work on the project.
i) Tourism spending grew moderately. Visitor spending
growth was 2.0% over the June 2019 year, just behind the national increase of
3.2%.
j) Despite more visitor spending, commercial guest nights
eased 3.5%, pulled down by international guest nights. A similar pattern to
international guest nights has been experienced nationally, as international
visitor arrivals growth slows and private accommodation platforms, such as
Airbnb, continue to expand. Statistics NZ recently estimated private
accommodation accounted for 18% of guest nights nationally.
5 The monitoring report for
year ending June 2019 is provided as Attachment A for the Economic Development
Committee.
OPTIONS
6 There
are no options.
Signatories
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Author:
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Suz Jenkins - Finance and Office Manager
Benje Patterson - Business Analysis Contractor
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Authoriser:
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John Christie - Director Enterprise Dunedin
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Attachments
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Title
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Page
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⇩a
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Dunedin City Quarterly
Monitor Report - June 2019
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21
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SUMMARY OF CONSIDERATIONS
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Fit with purpose of Local Government
This report
relates to providing a public service and it is considered good-quality and
cost-effective.
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Fit with strategic framework
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Contributes
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Detracts
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Not applicable
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Social Wellbeing Strategy
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☐
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☐
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☒
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Economic Development
Strategy
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☒
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☐
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☐
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Environment Strategy
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☐
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☐
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☒
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Arts and Culture Strategy
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☒
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☐
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☐
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3 Waters Strategy
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☐
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☐
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☒
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Spatial Plan
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☐
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☐
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☒
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Integrated Transport
Strategy
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☐
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☐
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☒
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Parks and Recreation
Strategy
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☐
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☐
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☒
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Other strategic
projects/policies/plans
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☒
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☐
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☐
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Enterprise Dunedin is responsible
for the delivery of the 2013-2023 Economic Development Strategy.
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Māori Impact Statement
There are no known impacts
for tangata whenua.
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Sustainability
There are no known impacts
for sustainability.
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LTP/Annual Plan / Financial Strategy /Infrastructure
Strategy
Enterprise Dunedin
activities and delivery on the 2023-2023 Economic Development Strategy are
included in the 2018-28 Long Term Plan.
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Financial considerations
There are no financial
considerations.
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Significance
This report is considered
low significance under the Significance Engagement Policy.
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Engagement – external
Infometrics Ltd were
engaged to provide the report.
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Engagement - internal
No internal engagement has
been undertaken.
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Risks: Legal / Health and Safety etc.
There are no identified
risks.
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Conflict of Interest
There are no conflicts of
interest.
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Community Boards
There are no known
implications for Community Boards.
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Economic Development Committee
3 September 2019
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Enterprise Dunedin Activity Report - August 2019
Department: Enterprise Dunedin
EXECUTIVE SUMMARY
1 The
purpose of this report is to update the Economic Development Committee on a
selection of Enterprise Dunedin activities.
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RECOMMENDATIONS
That the Committee:
a) Notes the
Enterprise Dunedin Activity Report – August 2019.
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BACKGROUND
2 Enterprise
Dunedin activity is informed by the 2013-2023 Economic Development Strategy
(strategy). The strategy is underpinned by five themes:
a) Business
vitality – to improve the ease of doing business.
b) Alliances
for innovation – to improve linkages between industry and research.
c) A
hub for skills and talent – to increase retention of graduates, build the
skills base and grow migrant numbers.
d) Linkages
beyond our borders – to increase international investment and establish
projects with other cities.
e) A
compelling destination – to increase the value of tourism and events and
improve the understanding of Dunedin's advantages.
3 The
strategy sets out two economic goals:
a) 10,000
extra jobs over 10 years (requiring growth of approximately 2% per annum).
b) An
average of 10,000 of extra income for each person (requiring GDP per capita to
rise 2.5% per annum).
DISCUSSION
Major Projects and Key Focus Areas
Project
China
4 Qingdao
delegation to Dunedin
A
Vice Mayoral level delegation led by the Vice President of Committee visited
Dunedin in July.
5 Shanghai
Staff Exchange ‑ Shang Bin
a) An
official from the Shanghai Foreign Affairs Office joined Enterprise Dunedin on
5 August for an eight-week staff exchange, as part of an agreement with
Shanghai agreed in 2013. The official, Shang Bin will gain a better
understanding of Dunedin and the cooperation occurring between Dunedin and
Shanghai in various fields.
b) She
will also meet with external parties who have projects or alliances with
Shanghai, including the University of Otago, Otago Polytechnic, Chamber of
Commerce, Chinese Garden and the New Zealand–China Non-Communicable
Diseases Research Collaboration Centre (NCD CRCC).
6 Signing
of Education Commission Agreement
a) The
education commission agreement between the Shanghai Education Commission and
Enterprise Dunedin was re-signed in Shanghai by Dunedin City CEO, Dr Sue
Bidrose, and the Shanghai Education Commission Deputy Director General, Mr. Li
Yongzhi.
b) The
Shanghai Education Commission acknowledged the activities of the Dunedin
Mayoral Scholarship and assisting Shanghai university students in gaining work
experience in their areas of study/professional interest while in Dunedin.
7 Mayoral
led delegation for opening of film festival
a) Mayor
Cull, Shanghai NZ Consul General, Andrew Robinson, and Director of the Film
Department of Shanghai Film Bureau, Peng Qizhi opened the NZ film festival in
Shanghai in July. Four Dunedin films were included in the festival which also
attracted 150 guests for the opening.
Enterprise
Dunedin Activity Outcomes
8 Enterprise
Dunedin’s activities are focused around the Economic Development Strategy
themes. The following section provides highlights of some of the key activities
and outcomes that have occurred within each theme during the past few months.
Business Vitality
9 The
Otago Regional Business Partnership (RBP) final update for the 2018/19 year
a) The
Otago RBP is funded to deliver business capability support, mentors and research
grants by New Zealand Trade and Enterprise (NZTE) and Callaghan Innovation. For
the year ending June 2019, all KPI’s were met apart from Business Mentors
which achieved 82% of the KPI.
b) At
the completion of the 2018/19 financial year the Otago RBP issued 285 clients
with approximately $215,000 in training grants and matched 94 mentors to
businesses.
c) Over
this reporting period five Callaghan Innovation clients were successful with
research and development project grants totalling more than $100,000. This
supported projects totalling $300,000 approximately in value. One Student
Career grant was successful with a value of $35,000. Three research and
development project applications, each more than $1 million were underway at
the conclusion of the financial year (one of these has since been approved).
Four Getting Started Grants were also approved totalling $20,000.
d) From
2019/20 the Otago Chamber of Commerce will administer the RBP across the Otago
region. All partners felt administration of the programme would be easier
with a single entity delivering. The Otago Chamber of Commerce was
awarded the Otago RBP contract with support from the DCC and the Otago
Southland Employers Association.
10 Energy
a) The
District Energy System Group is continuing work to evaluate the feasibility of
a new district energy system for central Dunedin. The working group (DCC,
University of Otago, Southern DHB, Ministry of Health) engaged Stantec to
develop an indicative business case including a short-list of potential system
options, comprising fuel/energy source, reticulation system specifications, and
overall system size and scalability. The draft findings were presented by
Stantec to the Local Advisory Hospital Group in July. The final report from
Stantec is due by the end of August.
b) Enterprise
Dunedin continues to work with ChargeNet and Aurora to progress installation of
an electric vehicle (EV) fast charger on Water Street, as approved by Council
on 26 March 2019. The site license agreement has been prepared and is being
reviewed by ChargeNet. The installation date is yet to be confirmed.
11 Business
clinics
a) There
were 52 referrals to the Enterprise Dunedin business clinics in the year ending
June 2019 year.
b) The
industries that took part in business clinics over the June 2019 year are
summarised in the chart below. A diversified range of industries were
represented in the business clinic service.
Alliances for Innovation
12 Film
Dunedin
a) Film
Dunedin responded to 74 screen enquires about filming in Dunedin to the end of
June 2019. This compares to 41 enquiries in the 2018 year.
b) There
were 46 film permits issued over the 12 months to June 2019, compared to 43 the
previous year.
c) Permit
data indicates an additional 12,048 bed nights were generated by film in
Dunedin in 2018/19 compared with 7,429 the previous year. Permits are only
issued for shoot days on public land. Total bed nights are therefore
considerably more than the actual permitted activity. Blumhouse film Black Xmas
for example, generated 3,000 bed nights but only filmed once on public land and
so only 80 bed nights are included in the figures above.
d) The
total number of location shoot days increased at a faster rate than permits
issued, rising from 57.1 in the June 2018 year to 102 in the June 2019 year.
This increase was driven by productions having a longer average duration.
e) Total
crew numbers working on productions reached 506 in the June 2019 year, with 368
of these employed on international productions, 66 on local Dunedin
productions, and 72 on productions from elsewhere in New Zealand.
f) International
productions are typically of a much larger scale than New Zealand productions.
In the June 2019 year, there were 24.5 crew on average per international
permit. By comparison Dunedin productions had an average of 3.7 crew, while
other New Zealand productions had an average of 5.5 crew.
Table - Film characteristics by
production origin (June 2019 year)
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Production Origin
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Proportion of
Permits
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Average Shoot
Days Per Permit
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Average Crew
Per Permit
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Dunedin
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39%
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3.2
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3.7
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Rest of New Zealand
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28%
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1.1
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5.5
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International
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33%
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2.0
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24.5
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100%
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2.2
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11.0
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A Hub for Skills and
Talent
13 JobDUN
- Business Internship programme
a) Enterprise
Dunedin facilitates the business internship programme – JobDUN
(previously known as Sexy Summer Jobs). The objective of the JobDUN programme
is to meet business needs, create high value jobs, retain skills and talent in
the city and contribute to the economic growth of Dunedin. Businesses utilise
the programme to reduce the commercial risk in taking on an untried person. It
provides the opportunity for market and product development, which might not
otherwise be executed.
b) The
programme allocates funding for 50 intern placements.
c) The
2019/20 programme kicked off in August with promotion to students and
engagement with businesses. Responses so far include:
i) 11
businesses have applied for interns and one of those is a new business
ii) 30
interns have registered interest, 20 placements are still available
iii) The
range of roles is diverse, including marketing, production engineer, software
developers/engineers, web design, graphic design, publicity, electronics,
business development, media, community events
d) Work
is underway in partnership with the University of Otago and Otago Polytechnic,
on the business/intern speed interviews event on 18 September, with several
businesses already registered to attend.
A Compelling Destination
14 Visitor
Statistics
a) Commercial
guest nights fell 3.5% over the June 2019 year. This reduction was concentrated
on the international market, with domestic guest nights still expanding.
b) A
similar pattern to guest nights has been experienced nationally, as
international visitor arrivals growth slows and private accommodation
platforms, such as Airbnb, continue to expand. These private accommodation
platforms are not captured by official accommodation statistics.
c) To
overcome shortcomings in monitoring guest nights, the Ministry of Business,
Innovation and Employment has recently put out a Request for Proposal for an
improved accommodation supply and demand dataset. The new dataset will provide
insight on both the commercial and private accommodation guest nights to a
territorial authority level. The new system is expected to go live in the New
Year, while the existing commercial accommodation monitor will cease following
the release of September data.
d) Occupancy
rates in Dunedin hotels have eased from 71.3% to 68.6% in the June 2019 year
compared to the previous year, according to data from Tourism Industry
Aotearoa. This trend is similar to what was experienced nationally.
Nevertheless, average hotel room rates in Dunedin still increased over the past
year, rising from $149 to $155.
e) Data
collected by Dunedin City Council’s Parks and Recreation team shows the
number of vehicles freedom camping at five monitored locations over the 6
months to 31 May 2019 totalled 13,632. This was up 21% compared to the same
period the previous year.
f) Visitor
spending in Dunedin rose 2.0% over the June 2019 year, just behind the 3.2%pa
growth recorded nationally.
g) Spending
growth was strongest for international visitors to Dunedin, rising 6.0% over
the June 2019 year, compared to 4.6%pa growth nationally. This result has been
strengthened by a record cruise season.
h) Domestic
visitor spending in Dunedin climbed just 0.3% over the June 2019 year, compared
to 2.3%pa growth nationally. Slower growth can be partly attributable to the
biannual hosting of the New Zealand Masters Games and three Ed Sheeran concerts
that inflated the 2018 result.
15 Business
Events (Conferences)
a) Enterprise
Dunedin hosted three clients throughout July for conferences in the shoulder
season of 2020 and 2021. These have a combined estimated value to the
city $772K.
b) Enterprise
Dunedin assisted the Dunedin City Council transport team in securing the 2020
2Walk and CYCLE conference, with an estimated value of $351k for the
city. The event date is yet to be confirmed.
16 Consumer
Marketing – New Zealand and Australia
a) The
domestic winter campaign “Winter Imaginarium” leveraged off winter
events and experiences to encourage visitation to Dunedin over the winter
months with the primary target being the 3.5-hour drive market.
· Using
DunedinNZ social channels and Google Adwords, campaign consumers were directed
to the Winter pages on DunedinNZ.
· Operators
were encouraged to submit deals for this campaign, with 3,495 unique views on
the ‘deals’ webpage.
· A
collaboration with Dunedin Airport focused on the Wellington market in
promoting the James Cameron exhibition ‘Exploring the Deep’ at
Otago Museum. A mirror campaign was run with WREDA on The Breeze Dunedin at the
same time as Enterprise Dunedin’s collaboration in ‘The
Breeze’ in Wellington. This radio and online marketing activity included
the ‘Winter Imaginarium’ video and a competition for a weekend
for two in Dunedin. The entrants who agreed to be included on the Enterprise
Dunedin database will be used for future remarketing.
b) The
DunedinNZ social pages Facebook and Instagram audiences are increasing with
Facebook showing a 3.5% growth and Instagram a 26.8% increase from the last
financial year. Total audience sizes for these channels are Facebook 89,000 and
Instagram 35,500.
17 International
Trade
In August Enterprise Dunedin organised a two-day event in
Auckland providing an opportunity for 29 export-ready operators from Dunedin,
Waitaki, Clutha, Central Otago, Southland and Fiordland to meet with 110
inbound tour operators operating in international markets. This was the largest
contingent of Dunedin operators, together with our neighbouring regions to
attend this bi annual event, which provides an excellent showcase of the
diverse tourism products available in our regions.
18 PR
and Promotions
a) For
the year ending June 2019, Enterprise Dunedin hosted 89 people on media famils,
an increase from 79 people the previous year. Of those hosted 46 came to
Dunedin via Tourism New Zealand’s international media programme, while 43
were organised directly through Enterprise Dunedin.
b) Since
the last EDC update, there were four media famils
· Metro
magazine
· Dish
online – readership of 30,000
· New
Zealand Geographic – readership of 337,000 and
· The
Guardian Australia – unique audience of 5.4million
c) Three
Dunedin travel features have recently been published in the Australian market
i) The
Guardian Australia – unique audience of 5.4 million
ii) Courier
Mail (Q Weekend, Brisbane) – readership of 388,000
iii) Nine
Honey Travel – unique audience of 3.5 million.
19 i-SITE
Visitor Centre
a) Statistics
New Zealand have confirmed that the 2018/19 cruise season was a record. Total
passengers (including crew) were 335,441, up from 254,750 in 2017/18.
b) Total
cruise ship expenditure, covering both vessel and visitor spending, was $60.2
million in 2018/19, up from $48.0 million the previous season. Spending by
cruise ships and their visitors were the key contributor to total visitor
spending growth in Dunedin, which climbed $15 million to $771 million.
c) Spending
growth over the past year was driven by a larger volume of passengers, rather
than each passenger spending more. Spending per passenger in 2018/19 was
$179.60, down from $236.48 per passenger in 2017/18.
20 Study
Dunedin
a) The
Work Ready Programme for International Student held another successful semester
networking and speed Interview event in July. The event was supported by
Dunedin employers, recruitment agencies and staff from Otago Polytechnic and
the University of Otago. 75 students and four partners of students
attended many of the sessions and the Otago MBA programme has asked for
specific sessions for its international student cohort this year.
b) Study
Dunedin hosted three Student Focus Group sessions in July and August. All
sectors of study were represented by the 18 students who attended to ensure
that the student voice is reflected in future marketing and student experience
event planning.
c) Dunedin
welcomed the 5th cohort of Shanghai Mayoral Scholarship students in
July. Twelve students from six Shanghai universities attended Business
English Classes, completed work experience in Dunedin businesses, explored the
city cultural institutions and spent time on the Otago peninsula. Many of
the students talked about Dunedin and the experience being life-changing at the
farewell.
NEXT STEPS
21 Feedback
on Enterprise Dunedin activity will be incorporated into future updates.
Signatories
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Author:
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Louise van de Vlierd - Team Leader Visitor Centre
Fraser Liggett - Economic Development Programme Manager
Malcolm Anderson - City Marketing Manager
Des Adamson - Business Relationship Manager
Suz Jenkins - Finance and Office Manager
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Authoriser:
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John Christie - Director Enterprise Dunedin
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Attachments
There are no attachments for
this report.
|
SUMMARY OF CONSIDERATIONS
|
|
Fit with purpose of Local Government
This report
promotes the economic well-being of communities in the present and for the
future.
|
|
Fit with strategic framework
|
|
Contributes
|
Detracts
|
Not applicable
|
|
Social Wellbeing Strategy
|
☐
|
☐
|
☒
|
|
Economic Development
Strategy
|
☒
|
☐
|
☐
|
|
Environment Strategy
|
☐
|
☐
|
☒
|
|
Arts and Culture Strategy
|
☒
|
☐
|
☐
|
|
3 Waters Strategy
|
☐
|
☐
|
☒
|
|
Spatial Plan
|
☐
|
☐
|
☒
|
|
Integrated Transport
Strategy
|
☐
|
☐
|
☒
|
|
Parks and Recreation
Strategy
|
☐
|
☐
|
☒
|
|
Other strategic
projects/policies/plans
|
☒
|
☐
|
☐
|
Enterprise Dunedin is
responsible for the delivery of the 2013-2023 Economic Development Strategy.
|
|
Māori Impact Statement
There are no known impacts
for tangata whenua.
|
|
Sustainability
There are no known impacts
for sustainability.
|
|
LTP/Annual Plan / Financial Strategy /Infrastructure
Strategy
Enterprise Dunedin
activities and the 2013-2023 Economic Development Strategy are included in
the 2018-28 Long Term Plan.
|
|
Financial considerations
There are no financial
considerations.
|
|
Significance
This decision is considered
low significance under the Significance Engagement Policy.
|
|
Engagement – external
As an update report, no
external engagement has been undertaken.
|
|
Engagement - internal
As an update report, no
internal engagement has been undertaken.
|
|
Risks: Legal / Health and Safety etc.
There are no identified
risks.
|
|
Conflict of Interest
There are no known
conflicts of interest.
|
|
Community Boards
There are no known
implications for Community Boards.
|
