The services industry continues to contract, as lingering Covid-19 restrictions weigh on trading activity.
Firms in hospitality and the accommodation and tourism sectors have been hit hard. Photo: 123rf
The BNZ-Business New Zealand Performance of Services Index (PSI) for October fell 1.9 points on the previous month, to sit at 44.6.
A reading above 50 indicates the sector is expanding, while anything below indicates contraction.
The PSI had now been below the break even mark for the past three months.
"Even though there's been some restrictions easing, there's still plenty of restrictions out there and the services sector is copping the brunt of it," BNZ senior economist Doug Steel said.
Those firms in the hospitality, accommodation and tourism sectors were really hurt, he said.
Most of the sub-categories, including employment, new orders, sales and stock levels were either flat or down on the previous month.
"It all reflects disruption from multiple sources," Steel said.
The 'best' of the major components was employment at exactly 50, he said.
"While below average, it suggests service sector employment is hanging in there with firms reluctant to let staff go if possible, despite the many significant challenges."
This month's PSI carved out the data by firm size, showing the smallest firms, with fewer than 10 staff, were the hardest hit with the PSI below 45.
The largest firms performed the best with the PSI at 57.8.
The northern region, which includes Auckland, was incredibly weak relative to other parts of the country, reflecting the effect of stricter lockdowns for longer.