The nation’s economic output, our gross domestic product (GDP), can be measured as a combination of personal consumption expenditure (e.g. food); investment expenditure by firms and households (e.g. machinery and houses); expenditure by the government (e.g. health services); and incomes from net exports made up from exports less imports.
Of all these, personal consumption expenditure is reported monthly but is measured on a daily basis using data from electronic card transactions. Electronic retail transactions data are reliable because they cover a very large part of all retail transactions for both goods and services. In this respect they are like a daily census of all retail transactions. In the year to March 2017, household consumption expenditure was about 60 per cent of total GDP expenditure. Consequently, electronic transaction data, as well as important measures of household behaviour, are useful measures of short-term fluctuations in a significant part of GDP.
In June, this usefulness was dramatically shown by a rise in monthly electronic card spending in the hospitality industry that coincided with the start of the British and Irish Lions rugby tour, according to Statistics New Zealand. This included spending at hotels, motels, bars, and restaurants. On a seasonally adjusted basis spending in hospitality rose $23 million (2.4 per cent) in June 2017 compared with May 2017. Hospitality makes up about 14 per cent of all electronic card transactions by value annually.
This short-term trend is set within an annual context of economic growth, supported by rising tourism and sustained migration. In the past year, tourism-driven hospitality expenditure has risen by 11 per cent.
In the long-term picture, in recent years, growth in the value of electronic transactions has oscillated between 4 and 7 per cent annually. In addition to tourism and migration, ongoing employment growth has lifted total incomes, despite relatively little growth in wage rates, and fed positively through to retail sales.