'It will come back': Wellington business owners optimistic despite ongoing challenges
Wellington businesses are trying to turn around the idea that the capital city is in a downward spiral.
Wellington business owners remain cautiously optimistic despite ongoing economic struggles, according to Business Central and Wellington Chamber of Commerce chief executive Hayley Horan. The city's economy has faced a challenging 2026, with a tentative first-quarter recovery disrupted by the Middle East war and the prospect of 3,500 public service sector job cuts.
Analysis of ANZ card spending shows a decline in spending for the city's first term in office, with July 2026 food and drink spending down 8% compared to July 2023, and retail spend (excluding clothing) down 5% for the same period.
However, director Justin Lester noted that Wellington has likely seen the worst of the downturn, with slight upward movements. Horan acknowledged that things remain tough for Wellingtonians but expressed hope for a positive future, citing new investment in the city and a growing sense of optimism. One of the biggest challenges businesses face is the perception of a downward spiral, which can create a lack of confidence and foot traffic.
Horan emphasized that narrative can impact behavior and economic uplift, but the narrative around Wellington needs to change.
Despite challenges such as local government amalgamation and dated infrastructure, these issues are not unique to Wellington. Business owners are taking action, with several initiatives in place. Horan highlighted the Te Aro Hā partnership, aimed at improving the dilapidated state of the city's entertainment district, which received $150,000 from the City Growth Fund. Additionally, the city council appointed successful entrepreneurs to business advisory groups to boost economic growth.
Some business owners shared their experiences, with Glou Glou co-owner Mike Nye stating that the cafe had been a bit hard since opening in 2024, but it has been growing month on month. Arty Bees, Wellington's largest second-hand bookstore, manager Matt Morris reported a patchy year, acknowledging that weather impacts sales but that people continue to buy second-hand books during the cost-of-living crisis.
Unity Bookshop co-owner Tilly Lloyd, despite being affected by the public service cutbacks, stated that the store is doing fine. Farry's, a Wellington menswear retailer, has been quiet in the past six months, attributing the decline to the war and subsequent government cutbacks.
Written by urgent.news from RNZ Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
