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New Zealand is seriously in danger of talking itself in to a much bigger depression than it needs to. Yes, there are some New Zealanders who are feeling the pinch. Equally, some hospitality operators are also feeling the pinch as the impact of increases in prices starts to bite. In the media we hear this doom and gloom about the impact of these prices on a daily basis.
There is another side to this story however, and a side that is very important to the prosperity of the hospitality industry. New Zealand has never had as many people employed and learning as they have today. These are people who are earning and do have dollars in their pocket to spend. The media make much of how New Zealanders are hurting because mortgage interest rates are going up. On the basis of the media coverage one would assume that every New Zealander has a mortgage. The reality is that less than a third of New Zealanders have a mortgage, the majority of those were taken out years ago, and the interest rates and mortgage repayments are extremely manageable.
Much is also being made of the impact of increased food prices on families. Undoubtedly this is of concern to some families, but are those families in fact the major customer demographic of the hospitality industry? I think not. The core consumers of hospitality products tend to be those who are single, couples without children and empty nesters. These are the population demographics who have the most discretionary dollars, and they still have them.
All the negative talk has the major risk of making these people nervous about spending when there is no need for them to take that approach. Yes, it is tough for some, but the majority still have a few dollars in their pockets to get out, socialise and enjoy the rewards of their labour. As an important sector of the economy the hospitality industry needs to be upbeat and talk up the economy, not help drive it in to depression.
Bruce H Robertson
Chief Executive
Hospitality Association of NZ
7 July 2008 |
