The Sunday Panel: Do we feel optimistic about the economy ahead of the new year?

This week on the Sunday Panel, NZ Herald senior writer Simon Wilson and Resident Economist at Opes Partners, Ed McKnight, joined in on a discussion about the following issues of the week - and more!

We've heard a lot about 'survive til 25' - are we actually feeling more optimistic about the economy as we enter the new year. How bad were things over the last few months, do we think?

What are we feeling ahead of the new year? Do we think 2026 will be better?

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Episode Transcript

Speaker 1 (00:06):
You're listening to the Sunday Session podcast with Francesca Rudgin
from News Talks edblaighty.

Speaker 2 (00:13):
Ho time for the panel, and I'm joined by New
Zealand Herald Senior writer Simon Wilson.

Speaker 3 (00:17):
Good morning, morning, Francisca and.

Speaker 2 (00:20):
Resident Economists economist at over his partner's Ed McKnight high ed.

Speaker 4 (00:25):
Great to be here, Francesca.

Speaker 2 (00:26):
Okay, Surviving in twenty five is a phrase that we've
heard quite a lot this week as people start to
assess the year. Ed from an economic point of view,
has twenty twenty five been as bad as it's felt.

Speaker 4 (00:39):
Yes, short upside, it's not just because the economy has
been shrinking, which it obviously has. With our population has
still been growing over the last year, even as our
economy either went sideways or went down and went backwards,
and so that means on a per person basis, we
have seen the economy strength. That basically means that kiwis

(00:59):
are getting poorer on average, though it's important to recognize that,
especially if you work for a mature company, one that's
been around for a long time. Times this year twenty
twenty five probably felt worse than if you were working
for say a growing company. You know, some growing companies
are still posting record results, but if you aren't, especially

(01:20):
a mature business, you've probably felt that twenty twenty five
was pretty tough.

Speaker 2 (01:25):
How do you rate twenty twenty five, Salmon Oh?

Speaker 3 (01:27):
I think perceptions are important, and people have felt that
their dollars do not go as far. It is harder
to shop in the supermarket and buy what you thought
you were going to buy. And it comes down to
that very simple truth. It's been a tough year and
I'm not sure it's going to change much next year.
I think there's also a larger issue involved that we

(01:51):
don't talk much about poverty anymore. But while we are
talking about way journeys and how it's a problem for
everybody who's earning a wage pretty much everyone, there are
also a lot of beneficiaries in this country who are struggling.
And we don't talk much about climate change either. We've
seen a big shift this year in policies that have

(02:12):
moved the country away from the kinds of climate action
that we were set on, and I think that's going
to come home and bite us before long time.

Speaker 2 (02:24):
A little bit of optimisms for twenty twenty six.

Speaker 3 (02:27):
Simon, a little bit of optimism. What am I going
to say in relationships with.

Speaker 2 (02:35):
You have to think about it, Simon, is all.

Speaker 3 (02:38):
But I think probably it's clearly going to be a
very close election, or this stage it really appears like
it will be. And therefore I'd like to think that
that will force the parties on both sides to think
really seriously about what they need to do to win
our trust, and there might be good outcomes from that.

(02:59):
They could also be terrible outcomes, but I'll be optimistic
and say they could be good outcomes.

Speaker 4 (03:04):
Well, I've got some optimism for you, Simon. I mean,
the good news is that business confidence is at an
eleven year high, and so even though the start of
twenty twenty five has been really tough, businesses are now
saying that they're seeing more spending throughout December, and so
hopefully that continues and there at least there's going to
be some optimism and businesses. If not with Simon today,

(03:26):
I think.

Speaker 2 (03:27):
You think Simon, anecdotally, we've all got an interesting mix
of stories. You know. I know people at the moment
who are being made redundant just before Christmas. I know
people who you know, are finally feeling like they are
back to where they were pre COVID. Just in the
last four to six months. I hear from some people
that say, you know, consumer confidence is up, but I
know big retailers saying, actually we need people to shop.

(03:48):
People aren't shopping. I feel like we're just at that
turning point where there's still quite a mix of anecdotal
sort of you know stories coming at us. But I
am hoping it's turning and on the app.

Speaker 3 (04:02):
Simon, yeah, well okay, to be hopeful. Well, no, this
Christmas is clearly going to be really critical. All Christmas
shopping periods are critical every year, but this one feels
like it really is. We don't yet know how well
it's going too early, but if it has done well

(04:23):
for retail, then that means that points to a confidence
of people being able to spend, and also means that
a whole lot of businesses get that fillip bleeding into
next year. It is you know, the prospect of shops
continuing to close is a terrible one for the commue.
We do need we do need shops to stay open.

Speaker 2 (04:42):
I mean, if you look at the big picture, there
are some tics here. You know, we're seeing the exports
sector is remaining resilient, Tourism activity is recovering in New Zealand,
inflation has eased somewhat and fingers crossed. But some of
the global risks that we've dealt with this year, the
trade tensions and thing that's all sort of settling down
a little bit.

Speaker 4 (05:04):
Well, it does seem to be settling a little bit.
The one thing I'd just say about their anecdotal evidence
is you'll only ever hear people complaining in New Zealand
about their own situations. So I mean that very kindly
because what you won't hear is it But if you are,
if you are doing well as a New Zealander, you
don't sing from the rooftops about it, especially when the
economy is doing quite poorly. So if you're a business

(05:26):
owner and you're having a record year, but your friend
has just lost their job and another business is going
through redundancy process, you're probably not going to sing from
the rooftops about how well you're doing.

Speaker 2 (05:36):
Obviously you read the room at the right time. But
telling I've got people telling me positive stories as well,
We're not going we don't just winch.

Speaker 4 (05:45):
I existed that you were just a window. I was
just saying, on average, you do to hear more negative
stories because it's it's people will share it when they're
having a hard time, but when you're doing really well.
Us as New Zealanders, we don't want to be seen
to be, you know, too showy. I suppose I.

Speaker 3 (06:02):
Think I think it's right about that. And I was
talking to somebody I've interviewed for a story, Stephen Pinker,
who's a have had psychologist talking to him this week
because I've got a story coming, and he made the
point that you know, bad news always gets into the
paper and always gets amplified, but often it's anecdotal people complaining,

(06:26):
but the data might tell a very different story. And
a good example of that is you could get the
impression from the media that we live in a completely
crime riddled society, but actually we don't, and the data
tells a much clearer picture. And I think there's a
challenge for all of us in media to work out
how to tell the stories about what's really going on

(06:47):
that don't just rely on, as Ed says, somebody complaining, Well.

Speaker 2 (06:52):
Simon, I do wish you all the beast. The twenty
twenty six because you're making some quite big changes next year.
You're retiring from your time here at nz ME and
the herold and things, and we're going to miss you terribly,
but we're going to still hit you up to be
on the panel.

Speaker 3 (07:06):
You see.

Speaker 2 (07:06):
You know what you do, you have a little saying
for your twenty twenty six if you come up with
some sort of witty little all.

Speaker 3 (07:14):
All the kicks in twenty six, you know, because yeah,
retiring is right. I'm going to retire in order to
work desperately hard for myself for much less money. What
about you?

Speaker 2 (07:27):
Well, thank you very much for being part of the panels, Simon,
and we will miss you in the office. Do you
have a little saying for yourself for twenty twenty six?

Speaker 4 (07:34):
Hope for effects and twenty six has been the one
that I've been saying to people.

Speaker 2 (07:39):
We took a slightly more positive chance sort of take
on that Kurian I said, we said it will fix
in twenty six, So there we go. Simon Wilson and
Ed McKnight, thank you both very much for being on
the panel today and throughout the year. Really appreciate it.

Speaker 1 (07:53):
For more from the Sunday session, with Francesca Rudkin. Listen
live to news talks it'd be from nine am Sunday,
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