5 Aug 2015

Minister rejects predicted end of rebuild

6:04 pm on 5 August 2015

The Earthquake Recovery Minister is rejecting a prediction the Christchurch rebuild is close to peaking.

Christchurch construction.

An economist has predicted the loss of 14,000 construction jobs by 2022 as the rebuild comes to an end. Photo: RNZ / Alexander Robertson

The claim is being made by Westpac economist David Norman, who says activity will begin declining from the end of next year, leading to the loss of 14,000 construction jobs by 2022.

Read the full release from Westpac here

Mr Norman said Canterbury had experienced a record low unemployment rate of 3.4 percent - less than half the national rate - thanks largely to the rebuild.

But he said the good times were about to end.

"We have reached a point where there is no additional work from month to month, so it's just flattened off. We anticipate that will last for around 15 months and at that point we'll start to see the work taper off."

Mr Norman said 80 percent of the 22,000 new jobs created since the earthquakes have been filled by locals, rather than overseas workers or those from elsewhere in the country.

He said that meant there was a risk the city would be stuck with these workers once the work runs out.

"I would like to think local and central government agencies are already thinking about this, what they're able to do to attract other industries to the region, retraining, upskilling workers to move from construction into other industries."

National MP, Gerry Brownlee.

Earthquake Recovery Minister Gerry Brownlee said it was far too soon to be planning for the end of the rebuild. Photo: RNZ / Alexander Robertson

But the Earthquake Recovery Minister, Gerry Brownlee, said it was far too soon to be planning for the end of the rebuild.

"There is a can-do attitude here and I don't see that being lost and I don't take a pessimistic view that we need to start planning now for the day the sky starts falling in."

Mr Brownlee said anchor projects such as the Convention Centre and the Metro Sports Facility would provide construction jobs for the next four years, and Westpac's report was wrong.

"It doesn't take account of the fact there are vast amounts of land in the city that private developers will fill up progressively over the years ahead.

"It is disappointing that a bank that you would think would be wanting to encourage people about their investment in a place like Canterbury, take such a dismal view of it.

"And I encourage people to take note of that."

Christchurch construction.

Photo: RNZ / Alexander Robertson

Canterbury Employers Chamber of Commerce chief executive Peter Townsend said, while he agreed the rebuild had plateaued, he did not agree there would be a decline in activity from the end of next year.

"We're currently spending about $100 million a week, every week, on the rebuild and if you look at every piece of information you can get your hands on, it'll tell you that's going to continue to occur over the next three to four years.

"So we've got plenty of time to look at how we find other ways to usefully employ and usefully hold people in our community."

Mr Townsend said there was a danger the city might start talking itself into a downturn.

"If an economist comes out and says things are going to get more difficult and there's going to be a downturn, then people get more conservative in their decision-making processes and it can become a self-fulfilling prophecy.

"That's the last thing we need in a vibrant economy like Canterbury and Christchurch."

Mr Townsend said by the time the rebuild did come to an end, further jobs would have been created in agriculture thanks to increased irrigation and the booming tourism industry.