Spending lifts at cafes and restaurants as restrictions ease

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Spending in the hospitality industry has increased, but is still down from the same period last year.

Mark Taylor / Stuff

Spending in the hospitality industry has increased, but is still down from the same period last year.

The easing of restrictions is prompting New Zealanders to spend more at their local cafes, restaurants and bars, according to new data.

Data released by Worldline, formerly Paymark, shows that spending through hotel merchants grew steadily over the last four weeks of March.

But the monthly total of nearly $700 million was still down 16.3% in March last year, when lockdowns weren’t in effect and Covid case numbers were low.

Worldline’s chief data officer, George Putnam, said the difficult business conditions remained. Hospitality spending was still down 26% from pre-Covid levels in March, but the gap between 2019 and 2022 has narrowed significantly in the month, hospitality spending over the past week of the month being reduced to 15%.

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“There are encouraging pockets of recovery, and hospitality is one of them in particular,” he said.

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Prime Minister Jacinda Ardern said outdoor gathering limits for events would increase from March 26, while indoor limits would increase to 200 people. (Video first published on March 23, 2022)

“As international travel rules continue to ease in the coming months, the indicator will be business performance relative to pre-Covid levels,” Putnam said.

On Monday, the hospitality industry called for greater clarity on when the country would move to the orange setting.

New Zealand Prime Minister Jacinda Ardern has said the country will remain in the red for now, but another review will take place on April 14.

At orange, there would be no limit to the number of people allowed at gatherings.

Meanwhile, spending in the rest of the core retail sector reached $2.9 billion in March, up 2.5% from a year ago and 10% from to pre-Covid levels.

Putnam noted that the patterns could be markedly different for trader pools.

Spending in the rest of the core retail sector reached $2.9 billion in March, up 2.5% from a year ago and 10% from levels in before covid.

Chris McKeen / Stuff

Spending in the rest of the core retail sector reached $2.9 billion in March, up 2.5% from a year ago and 10% from levels in before covid.

Stores selling hardware, appliances and furniture saw 23% more spending compared to March 2019, he said.

But spending was below 2019 levels at booksellers and clothing and shoe merchants.

In the regions, spending in Otago was below pre-Covid levels, down 1.9%, but Taranaki recorded three-year spending growth of 25.4%.

First Retail Group chief executive Chris Wilkinson said consumer confidence had increased as people came to terms with the Omicron outbreak.

“Over the past few weeks, we have also seen increased activity in our main hubs, with businesses and government departments starting to encourage people to return to the office.”

Half-price public transport fares had also helped encourage people to back off.

“Hospitality is also seeing ‘wellness’ spending and communities coming together around their favorite cafes and bars – recognizing that local support is particularly important.”

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