The Employers and Manufacturers Association (EMA) says the 0.9% contraction in GDP for the June quarter is a sharp reminder of how fragile business confidence remains, especially in sectors like construction and services.

“This result is a knock at the wrong time,” said Alan McDonald, EMA’s Head of Advocacy and Strategy.

He noted that while recent sentiment has started to improve, lagging data still paints a gloomy picture for businesses hesitant to invest or hire.

McDonald pointed to a “two-speed economy,” with exporters and primary producers showing signs of recovery while urban service sectors continue to struggle.

He said government reforms around planning, immigration, employment law and vocational training are encouraging, but progress must speed up.

“Let’s get moving on the school and hospital upgrades announced in the May Budget,” he said, suggesting projects be prioritised in slower-growing areas like South Auckland to restore confidence and create momentum.

The EMA argues that accelerating infrastructure builds, rather than simply spending more, will stimulate activity and send the right signals to businesses.

It also welcomed the government’s funding boost for major events and tourism, calling it a “shot in the arm” for recovery.

On the Hibiscus Coast, many families rely on construction and service jobs tied to Auckland’s economy.

Changes in business confidence and the timing of infrastructure projects such as hospitals and schools are likely to affect household stability locally as well as in the city.

Seen something local we should cover?

Let us know at [email protected]