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Brad Olsen: Infometrics Principal Economist on card spending dropping in November · Best of Business

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  Speaker 1: You're listening to a podcast from Newstalk Z'B. Follow this
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  Speaker 2: Cards spending data from November suggest kiwis are holding their
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  Speaker 2: cards close to their chests literally. Kiwibank says the value
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  Speaker 2: of spending drop two and a half percent in November.
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  Speaker 2: That's down. A and Z says its data shows a
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  Speaker 2: drop of one point two percent year on year two.
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  Speaker 2: Brad Olsen, the Infametrics principal economist, is with us tonight. Hey, Brad,
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  Speaker 2: good evening November was still pretty tough.
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  Speaker 3: Yeah, I mean it's quite clear for a lot of
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  Speaker 3: retailers that. Of course, although interest rates have started to
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  Speaker 3: come down, not everyone's immediately refixed onto those lower rates,
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  Speaker 3: and so that pressure on household budgets is still pretty clear.
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  Speaker 3: Although a lot of the numbers are showing as still
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  Speaker 3: an annual decline year on year, there are some early
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  Speaker 3: signs in the numbers, both looking at what A and
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  Speaker 3: Z's put out, but also some numbers recently from Worldline
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  Speaker 3: that suggest that going into that Christmas period though there's
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  Speaker 3: a little bit of a shift coming through, so down
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  Speaker 3: on a year ago, perhaps up a little bit on
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  Speaker 3: where we've been the last couple of months. For example,
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  Speaker 3: the Worldline data suggests it as we're starting to get
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  Speaker 3: into the Christmas spirit, there has actually been a lift
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  Speaker 3: in spending compared to last year for the first week
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  Speaker 3: I think it was for Christmas A and Z again
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  Speaker 3: suggesting that when you look at some of that spending
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  Speaker 3: month on month, again a very slight lift. It's not huge,
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  Speaker 3: it's not you know, the economy and spending really starting
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  Speaker 3: to get going, but it's a bit of a change.
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  Speaker 2: So maybe we've just left around a little bit later
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  Speaker 2: hopefully this year. That's what it's indicating.
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  Speaker 3: Well, I think as well. You've got a lot of
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  Speaker 3: households that you know, there is a bit more confidence
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  Speaker 3: that has come through the last couple of months. People
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  Speaker 3: can see that light at the end of the tunnel.
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  Speaker 3: They can see better things around the corner. They're still cautious,
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  Speaker 3: you know, people aren't breaking out the champagne bottles yet,
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  Speaker 3: but there's just a little bit of a shift in
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  Speaker 3: terms of people's sentiment, their expectations. Maybe a little bit
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  Speaker 3: more that goes into the present budget. Not a lot.
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  Speaker 3: You're not sort of you know, doubling up who you're
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  Speaker 3: buying for and giving everyone three preince this year, but
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  Speaker 3: maybe a little bit of a shift in the budget.
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  Speaker 2: What about the job numbers we got out today had
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  Speaker 2: they look brad job.
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  Speaker 3: Numbers and the wider labor markets still quite challenging. To
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  Speaker 3: be fair, the start is only up until September, and
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  Speaker 3: we've seen again that sort of continued drop as we've
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  Speaker 3: been seeing from a number of other indicators coming through
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  Speaker 3: stats n Z reporting that for the September twenty twenty
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  Speaker 3: four quarter, six thousand, seven hundred odd fewer jobs than
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  Speaker 3: in June. Once you take into account seasonality, the biggest
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  Speaker 3: drops occurring in the likes of construction, accommodation and food
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  Speaker 3: services and admin role. So still quite tough out there,
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  Speaker 3: and in particular you're seeing some sort of big drops
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  Speaker 3: in different parts of the country. Auckland down nearly seven
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  Speaker 3: thousand roles are compared to where we were midyear, so
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  Speaker 3: all of that is dropping away. Interestingly, although we normally
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  Speaker 3: in economic downturns see that the likes of women often
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  Speaker 3: suffer greater levels of unemployment, actually this time with a
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  Speaker 3: much higher construction drop off that's been affecting more males
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  Speaker 3: and seeing that group dropping out of work a bit
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  Speaker 3: more so. Overall, labor market's still tough, but maybe some
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  Speaker 3: early changes coming through and the spending are likely not immediately,
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  Speaker 3: but likely into twenty twenty five to support a bit
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  Speaker 3: of a shift around in jobs. But we know the
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  Speaker 3: jobs market always takes a bit longer to shift.
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  Speaker 2: Yeah, and we've still got I mean that the unemployment
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  Speaker 2: numbers for next year aren't looking to Rosie ave for
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  Speaker 2: us here heading it, I think topping at five and
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  Speaker 2: a half percent by the middle of next year, right.
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  Speaker 3: Well, and that's the thing. I mean that the four
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  Speaker 3: car sort of range from about two point five, sorry,
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  Speaker 3: five point two through to five point five. You're right,
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  Speaker 3: But regardless, that's still a lot of people who are
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  Speaker 3: obviously finding it more difficult. We've also seen this year
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  Speaker 3: more people dropping out of the jobs market sort of entirely.
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  Speaker 3: They're not even becoming unemployed, they're becoming so disenfranchised they're
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  Speaker 3: not even looking for jobs at the moment, they're not
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  Speaker 3: keen to get them because they can sort of see
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  Speaker 3: how difficult it is out their job adds. You know,
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  Speaker 3: new positions being advertised now at like twenty thirteen levels,
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  Speaker 3: and many more people applying, so a lot of competition
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  Speaker 3: out there, and of course that's incredibly difficult.
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  Speaker 2: It certainly is. Brad, thank you very much for that.
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  Speaker 2: Great to have you on the show. Brad Olsen, Infametrics
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  Speaker 2: principal Economists.
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