He said there were key nuances between the regions.<\/p>\n
Southland and Otago were flourishing lately, and Waikato and Canterbury were not too bad, but in many other places the mood was of trepidation.<\/p>\n
Olsen told leaders of the $23.8 billion aviation sector that some key indicators around household spending were looking promising late last year.<\/p>\n
But the Trump administration tariffs this year sent a chill through the economy, he said.<\/p>\n
Olsen, who claimed to have notched up more than 100 domestic flights, said many people were cutting back on leisure-related aviation spending, switching to driving.<\/p>\n
Yet he said a domestic tourism decline was afflicting much of the North Island.<\/p>\n
A major challenge for aviation in this country and many others related to supply chain issues and parts shortages.<\/p>\n
The crowd heard a component made in one country might attract tariffs because at some stage of its production it entered another country subject to high tariffs.<\/p>\n
There was often not the \u201cdirect or linear connection\u201d between tariff rates and what New Zealanders actually had to pay, he said.<\/p>\n
\u201cIt\u2019s very bitsy how these tariffs are playing out.\u201d<\/p>\n
Olsen\u2019s address to the AIANZ conference<\/a> came ahead of Thursday\u2019s second-quarter GDP results<\/a>.<\/p>\n Infometrics was picking a second-quarter contraction, as were ANZ, BNZ and the Reserve Bank.<\/p>\n Global growth forecasts were also down since late last year, Olsen said.<\/p>\n Consensus forecasts then of 2.5% growth had since been revised to 2.2%, he said.<\/p>\n That was partly due to Trump\u2019s tariffs.<\/p>\n \u201cHowever, we\u2019ve also got increasingly global conflicts,\u201d Olsen said.<\/p>\n \u201cDealing with another crisis every couple of weeks feels like a grind-down on everyone.\u201d<\/p>\n He said consumers were wary of spending when food prices<\/a> and utility bills weren\u2019t showing signs of coming down.<\/p>\n Jobs: More people \u2018disenfranchised\u2019<\/p>\n He said a key concern for New Zealand was around unemployment, especially among youth.<\/p>\n But he also said there were more people not actually looking for jobs at the moment.<\/p>\n \u201cThey\u2019re getting disenfranchised and falling out of the workforce.\u201d<\/p>\n For aviation, skills shortages among pilots, engineers and others were a key concern.<\/p>\n And some of those concerns tied in with debates about immigration.<\/p>\n Olsen suggested New Zealand did not collect enough data on the skill level of people leaving the country.<\/p>\n According to Stats NZ, annual net outflows of New Zealand citizens hit a record high of 47,600 in the year to June 30.<\/p>\n That was driven by migration departures strengthening to a record 73,480. <\/p>\n Olsen said the country had no idea how skilled those emigrants were.<\/p>\n And, aligning with recent forecasts from Morningstar<\/a>, he did not expect tourism numbers to reach pre-Covid peaks until 2028.<\/p>\n He said many major issues were beyond the control of consumers and business leaders.<\/p>\n But companies should keep an eye on cost pressures. <\/p>\n \u201cFor the aviation sector more broadly, it looks like there has been a little bit of relief.\u201d<\/p>\n Olsen said fuel prices were now about 15% below a 2022 peak.<\/p>\n Ageing population<\/p>\n A recurring issue at the AIANZ conference is the need to draw young people into the industry.<\/p>\n Some aviation professions have an ageing population.<\/p>\n Multiple people have told the Herald that the huge responsibilities of transporting people safely worry some young people who might otherwise embrace a career such as aviation engineering<\/a>.<\/p>\n \u201cIf you don\u2019t have younger skilled people coming through, you might find yourself on a fairly short runway,\u201d Olsen said.<\/p>\n \u201cIf we don\u2019t have the skills, we literally stop moving.\u201d<\/p>\n Dairy to the rescue?<\/p>\n Dairy and horticultural commodity prices<\/a> had shown promising signs but Olsen said the country had to be mindful of what was driving that growth.<\/p>\n Worldwide, more people wanted dairy and other protein products but if other countries ramped up production, New Zealand would have to adjust.<\/p>\n But he said in a positive sign for the domestic economy, core retail spending had risen for three successive months<\/a>. <\/p>\n Barbers praised for cutting red tape<\/p>\n Katherine Rich, BusinessNZ chief executive, made it clear where she stood on David Seymour\u2019s bid to slash red tape with the sometimes-pilloried Ministry for Regulation<\/a>.<\/p>\n She said for years or even decades, too many \u201cbespoke, stupid rules\u201d had hobbled growth.<\/p>\n \u201cWe\u2019ve actually made New Zealand quite a difficult place to do business.\u201d<\/p>\n She said barbers and hairdressers had been trying for 40 years to overturn archaic, useless rules.<\/p>\n