The Manawatū and wider New Zealand economy entered 2026 with clear signs of recovery. Economic activity strengthened, labour market indicators improved, and business conditions began to stabilise following a prolonged period of volatility. 

This is reflected in 2025 data, with regional GDP increasing to $8.794 billion. While growth of 0.3% sat just below the national rate of 0.4%, the return to positive territory marks an important shift after a period of subdued performance.  

However, this momentum has been tempered by renewed global uncertainty. Conflict in the Middle East has disrupted supply chains and lifted fuel and fertiliser costs, placing upward pressure on inflation and adding complexity for households and businesses.  

At this stage, risks to recovery appear concentrated in the near term. The underlying indicators point to continued improvement, particularly if global conditions stabilise, but the situation remains one to watch.  

“While global uncertainty is creating short-term pressure, the fundamentals that make Manawatū a great place to do business remain strong. We’re seeing continued investor interest, and growing confidence in the region’s long-term potential, positioning us well as conditions stabilise.”   

 - Notes Jerry Shearman, CEDA's Tumuaki - Chief Executive. 

Commentary and Insights - On the ground

• Labour market trends – Matt Smout, Client Manager at PN Personnel, shares insights on hiring trends, skills shortages, and shifting recruitment strategies across Manawatū, as businesses balance cautious hiring with improving confidence.
• Commercial construction outlook – David Aldred, Central Region Director at LT McGuinness, highlights emerging opportunities in the construction sector, noting early signs of recovery and the potential impact of future large-scale investment, including New Zealand Defence Force projects.
  
  
• Tourism and accommodation trends – Deborah March, General Manager at Copthorne Hotel Palmerston North, reflects on steady demand patterns across the week, the importance of events in driving occupancy, and the region’s ongoing role as a central hub for business and leisure travel.

Read more in the December 2025 Quarterly Economic Snapshot here ➝