The Council of Trade Unions welcomes today’s Gross Domestic Product (GDP) data showing New Zealand is on the right path to economic recovery from COVID-19.
CTU Economist and Director of Policy Craig Renney said “Annual GDP growth 5.1 is impressive, and compares very favourably with Australia, Canada, Europe and the US. These figures would appear to support the government’s decision to ‘go-hard and go-early’ on COVID-19 earlier in the year. Together with data on unemployment, this paints a picture of an economy doing much better than the Treasury had forecast at Budget 21 only months ago”.
“The challenge will be to maintain that momentum when we come out of the current COVID-19 restrictions. We can demonstrate our economic strength by making make sure that we build back better for all New Zealanders. There were signs prior to this lockdown that growth was not being shared fairly with wages falling in real terms and the cost of living for the poorest rising much faster than for the rich. The government should be congratulated for the immediate handling of the COVID-19 response. The challenge is now to ensure that this translates into improvements in peoples lives in the long term.”
“The GDP data also demonstrates the power of government support in the economy, and the vital role that it has had to play in delivering sustained economic growth.”
“The decision to spend significant sums of money to support demand in the economy during the initial COVID-19 lockdown has been shown to be the right approach. It has saved jobs, companies, and households from the negative effects that COVID-19 has seen delivered in other countries.”
“The government is therefore right to provide further support during the current lockdown, and it shows the value of government investment as we recover from this set of restrictions. On todays’ data the evidence is clear for a stronger role for the government in the economy into the future,” Renney said.
For more information contact:
Craig Renney, CTU Economist & Director of Policy