Manufacturing in Otago and Southland remained strong during September, helping underpin the fourth consecutive increase in expansion nationally.
While nationally, all five seasonally adjusted main indices were in expansion during September, Otago Southland's score of 65.4 remained far above the other three regions and dragged the national average up to 58.1,in the latest BNZ-Business New Zealand performance of manufacturing index.
Scores above 50 indicate expansion and below 50, contraction.
In the North Island, the northern region was down 1.7 points at 58.9, following a large increase in August, and the central region at 53.5 recovered from consecutive months in contraction to record its highest value since May. In the South Island, the Canterbury-Westland region rose 1.2 points to 55.9 while Otago-Southland was steady at 65.4.
Otago Southland Employers Association chief executive John Scandrett said the employment data revealed a ''worker flow'' into Christchurch, given the lift in the annual level of skilled vacancies, in the ''geographically positioned shoulder areas'' of both Otago-Southland and the Nelson-Tasman-Marlborough regions.
''This assessment gathers wider credence when you look at the selected industry group movements and see that construction and engineering sectors are fronting the advances seen,'' Mr Scandrett said.
Business NZ's executive director for manufacturing Catherine Beard said the continued upward track of the overall result was encouraging for the manufacturing sector.
Although 2014's start produced some healthy expansion results, activity levels mid-year were at a more moderate pace.
''The fact that the last two months have shown strong growth bodes well for the manufacturing sector as we enter the last quarter of the year,'' she said.
BNZ senior economist Craig Ebert said while dairy export prices and the outlook for dairy farmer income was becoming ''problematic'', New Zealand's construction industry was looking stronger by the day.
''The growth impulse from Canterbury's reconstruction might be peaking soon, but only a fraction of the estimated $45 billion of work has been completed so far,'' he said.
Nationally, the deliveries index led the way at 62.4, its highest result since July 2013, and new orders rose 1.5 points to 60 while production dropped 1 point to 59.3, but was still showing healthy activity levels, Ms Beard said.
The finished stocks index, at 58.1, was its highest value since the survey began in 2002, while employment rose another two points to 56.
Mr Ebert said the falling trend of the New Zealand dollar would help manufacturers' export revenue, but cautioned it would also create pressure on import costs, and servicing of any unhedged foreign-currency debt.
