April 28, 2022

Māori authority businesses weather the COVID storm

Sales, exports, and employment on the rise

Māori authority businesses have continued to display resilience in the face of economic turmoil. In 2021, the value of their sales, exports, and the number of filled jobs were all on the rise compared to the year before.

Māori businesses are an integral part of Aotearoa’s economy. And although such businesses are deeply intertwined in this ecosystem, they also make a unique contribution to our business world. BDO’s Māori business survey has found that kaitiakitanga (guardianship) and sustainability outcomes have always been a top priority for Māori businesses. They also place great value on being able to provide opportunities and support to their communities. COVID-19 intensified this goal, and many Māori businesses multiplied their efforts by providing support to the vulnerable. 

In this article, we will focus on the performance of Māori authorities, which are defined as businesses that administer communally owned Māori property on behalf of individual members. As of December 2021, there were over 1,450 economically significant Māori authorities and subsidiaries. A quarter of these operate in the primary and goods producing (manufacturing, construction, and electricity, gas, water and waste services) industries. Note that Māori-owned SMEs and tourism businesses are not represented within this data.

Sales by Māori authorities increased throughout the pandemic

Source: Statistics New Zealand

Growth in sales over the past year was supported predominantly by Māori authorities’ activities in the service sector. The value these businesses place on communal well-being meant that many Māori authorities assisted with the rollout of preventative measures, such as vaccines, during the pandemic. In the year to December 2021, the value of sales in the health care and social assistance sector were up by over 40 percent (past of the service sector in the graph below). Those in the primary sector also performed well, with sales up by 13 percent during the year. 

Source: Statistics New Zealand

The number of filled jobs was also up for those in the service (8.1 percent) and primary (1.4 percent) sector industries during the year, as were earnings by employees. Total earnings by primary sector employees rose by four percent, while for those in the service sector earnings were up by 14 percent. However, in line with the sluggish growth in sales for businesses in the goods producing sector, Māori authorities shed roles in these industries, with 7.6 percent fewer filled jobs compared to 2020. Total earnings for employees were also down by over eight percent.

Exports by Māori authorities grew faster than those for all New Zealand businesses

In 2021, total exports by Māori authorities were up by 21 percent, while export growth for all businesses was just 5.6 percent. Dairy products such as milk powder, butter, and cheese comprised nearly 40 percent of all exports, slightly higher than the 32 percent for all New Zealand businesses. These exports performed exceptionally well during the year, growing by 35 percent for Māori authorities, compared to 7.2 percent overall.  

As is the case for all New Zealand exports, the largest trading partner for Māori authorities, by far, was China, with over half (54 percent) of all international sales made there. This was significantly higher than the share of our total exports to China (34 percent). 

While this data points to the resilience of Māori authorities, it is important to remember that it does not paint a full picture of how all Māori businesses have fared. Māori-owned SMEs and tourism businesses faced the brunt of the pandemic. As the economy adapts to the post-pandemic world, many businesses and business support agencies will have to understand exactly what has driven the successes highlighted in this article and consider what long-term sustainability looks like, along with what form support for smaller businesses should take.