Cafes, accommodation lead way in steady service industries result

Cafes, restaurants and accommodation made a strong showing in the BNZ-Business New Zealand performance-of-service index for last December, and in spite of month-on-month declines, the sector remains in a positive expansion mode.

While most of the index readings for December were down on November readings, they remained well in the 50-plus points expansion range, as opposed to the December 2008 figures, where four of the five categories reflected contraction.

Within the monthly index, points above 50 reflect expansion while below 50 reflect contraction.

Otago Southland Employers Association chief executive John Scandrett said, despite the November decline, against November, the December points were the highest recorded since the index began in 2007 and revealed a similar "steadiness" to last week's sister survey, the BNZ performance-of-manufacturing index.

"The national September and October 2009 PSI readings were very close to, or above, the 50 point expansion/contraction break point," Mr Scandrett said in a statement yesterday.

Nationally, for December, the performance-of-service index fell from 56 points in November to 54.4.

Of the four regions, Otago reflected the largest decline, month-on-month.

It was 5 points down, at 54.4, followed by a 2.3 point decline in the Northern region, at 52.5, while Central and Canterbury-Westland were both up slightly, respectively at 60.9 and 56.1.

All four regions were up on December 2008 comparisons.

"While the mainstream PSI result within the region has appeared to reach a comfortable level of stability, we do continue to see some survey comments which reflect recession-generated negativity hasn't totally disappeared," he said.

Nationally, accommodation, cafes and restaurants led the way, with a "strong" result at 58.4, followed by wholesale trade, health and community services, and transport and storage, all up, with only property and business services declining, to 48.7 points.

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