Construction sales rise by almost $900 million in December quarter

Construction sales reached $19.6 billion in the December 2020 quarter, up $897 million (4.8 percent) from the December 2019 quarter, in part driven by home building, Stats NZ said today.

This followed a $1.6 billion (8.9 percent) year-on-year increase for the September 2020 quarter.

“After a low June 2020 quarter because of the COVID-19 national lockdown, construction sales rebounded in September and continued to grow in the December 2020 quarter,” business statistics manager Sue Chapman said.

Most of the growth in construction sales in the December 2020 quarter was driven by home building and construction services, which includes land development and trades such as plumbing, electrical, and carpentry.

See Commercial construction slows, residential holds up for more information on construction work in the December 2020 quarter.

Year201820192020
March quarter141110110001535735900016964326000
June quarter164800100001762309900013626094000
September quarter164590250001776907400019354600000
December quarter168066150001874463300019641460000

When comparing the full 2020 calendar year, construction sales were $69.6 billion, up 0.1 percent from $69.5 billion in 2019.

“Construction sales held up over 2020, despite the impact of the COVID-19 lockdown and changing alert levels during the year,” Ms Chapman said.

Healthcare and other medical services continue to rise

Healthcare and other medical services were up $408 million (9.8 percent) in the December 2020 quarter, when compared with the December 2019 quarter.

This followed a $685 million (17 percent) rise in September 2020 from the September 2019 quarter.

QuarterActual sales value ($)
Dec-173423368000
Mar-183371821000
Jun-183510303000
Sep-183730534000
Dec-183756251000
Mar-193650845000
Jun-193822281000
Sep-194088925000
Dec-194154182000
Mar-203982186000
Jun-203938737000
Sep-204773693000
Dec-204562150000

Healthcare services were one of the few industries that saw increased sales in the COVID-impacted June 2020 quarter, when compared with June 2019 quarter. Many healthcare businesses remained open in the June quarter because they are classed as essential services.

This industry includes private hospitals and medical services, health services such as dental and physiotherapy, and residential care services. It excludes public hospitals, district health boards and other government-funded health organisations.

Transport and travel drop

Transport, postal, and warehousing had the largest industry sales fall in the December 2020 quarter, down $1.6 billion (18 percent) from December 2019. This followed a similar $1.6 billion (20 percent) fall in September 2020 from September 2019.

The largest portion of the sales drop comes from the air transport sub-industry, which includes passenger flights and air-freight transportation.

“International air travel to and from New Zealand all but halted after COVID-19 travel restrictions came into place in March 2020,” Ms Chapman said.

“The impact of border restrictions on the transport industry has continued into the December quarter.”

Industry“Transport postal and warehousing”Administrative and support services
Dec-1987105240004640222000
Mar-2079376510004098939000
Jun-2055487190003359765000
Sep-2065235070003639329000
Dec-2071073200003477116000

The second-largest sales fall was in the administrative and support services industry, down $1.2 billion (25 percent) from December 2019.

The sub-industry driving this fall was travel agency and tour arrangement services.

“International tourism has taken a major hit, with lower levels of spending since the COVID-19 lockdown in early 2020,” Ms Chapman said.

“Travel and tour companies have seen sales fall sharply as a result. Travel agents are not so heavily involved with domestic travel.”

Retail trade

The largest industry increase for December was in retail trade, up $1.5 billion (6.8 percent) from December 2019. This excludes businesses involved hospitality, which are usually combined in the retail trade survey.

“People spent less on international travel in 2020 because of COVID-19. This surplus may have been directed towards household goods like furniture and appliances, or cars,” Ms Chapman said.

Retail sales hold up in the December quarter has more details on the sales of household and personal goods and services for the December quarter.

/Stats NZ Public Release. View in full here.