Praneeta Mahajan
Hamilton, June 1, 2023
Hamilton continues to have one of the country’s best performing economies, with GDP surging past the $13 billion mark for the first time.
Hamilton City Council has recently published their 2022 Annual Economic Report, giving an unrivalled insight into Hamilton’s economy, development and people during the 2022 calendar year. Drawing on a wide range of data sources, the report also provides an outlook for Hamilton and the wider economy in 2023.
The year gone by
The past year was challenging for Hamilton’s economy as businesses battled a combination of a labour shortage, COVID-19 disruptions and inflation. Yet the city’s economy came through with strong growth in GDP, jobs and spending, as well as significant investment in industrial development.
In 2022, Hamilton’s GDP ended the year at $13.4 billion, showing an increase of 4.1%. This compares to a 3.1% GDP increase in Auckland, 4.6% in Tauranga and 2.8% for New Zealand. Since the beginning of 2020, when the pandemic began, Hamilton’s GDP has increased $1.4 billion.
Industrial growth was spearheaded by development at the Ruakura Superhub and in Rotokauri, and was worth almost $194 million.
Growth Funding and Analytics Manager Greg Carstens said Hamilton’s record level of industrial consents (129,000m2) in 2022 was remarkable, especially given it occurred at a time when business and consumer confidence were at all-time lows. The city also spent half of 2022 under some form of COVID-19 restriction.
“Industrial consenting was the leading economic highlight for Hamilton in 2022. It was the highest on record both in terms of square metres and value of construction, and was nearly three times higher than any other year on record. The outlook for new industrial development remains strong, with consents for nearly 47,000m2 of new industrial floor area granted in the first four months of 2023.”
Growth in GDP
There were other positive signs across Hamilton’s economy last year as the city experienced increases in economic activity and spending, as well as employment growth.
Hamilton’s GDP reached $13.4 billion in 2022, representing an annual increase of 4.1% – outstripping GDP growth in Wellington (1.8%), Auckland (3.1%) and Dunedin (3.2%).
Nearly 3700 new jobs were filled last year, a rise of 3.7%. More than half of the new jobs were in healthcare, construction and manufacturing.
Road ahead not easy
Mr Carstens said the prospect for Hamilton’s economy in 2023 is subdued given the outlook for the national and global economies, but is still expected to perform strongly compared to other major New Zealand cities. Hamilton remains an attractive location for new and expanding businesses.
“There is still an expectation that New Zealand will enter a recession and Hamilton might follow. But the important thing to remember is that the projected fall in economic activity is less than 1%, and Hamilton, like New Zealand, has effectively full employment.”
“Yes, the outlook is not for the phenomenal growth like we have seen in recent years, but the past few years have shown just how resilient Hamilton’s economy is and it has outperformed most other cities. Things will slow in the short-term but the long-term strategic value proposition for Hamilton has not changed.“
Hamilton’s population grew by 800 people (0.4%) in 2022, reaching 179,900. Auckland, Wellington and Christchurch all experienced population declines last year.
Hamilton continues to impress
Hamilton has long been the city that services the Waikato region. In 2022, Hamilton was home to 44% of the region’s jobs and generated 42% of its GDP. We estimate about 15% of Hamilton jobs are filled by people from around the region.
Hamilton’s four biggest industries provide a significant proportion of regional industry jobs. Almost two-thirds of regional healthcare jobs are located in Hamilton as well as 56% of professional, scientific and technical jobs, 39% of manufacturing jobs and 39% of construction jobs.
Businesses Hamilton is home to almost 17,000 businesses.
Despite increasingly challenging business conditions, Hamilton’s business community grew by 5.1% (828 businesses) in 2022 – the highest annual increase since 2006, and slightly higher than New Zealand’s business growth (4.9%).
The construction sector saw a 7% increase in businesses and currently makes up 13% of all Hamilton businesses. Since 2019, the construction sector in Hamilton has expanded 16%.
About 60% of our businesses are sole traders with no employees and another 20% have one to five employees. In 2022, there were 162 businesses in Hamilton with more than 100 employees each, equivalent to 1% of all businesses. This compares to 0.5% across both Auckland and New Zealand.
Praneeta Mahajan is an Indian Newslink reporter based in Hamilton.
