Economic Shifts Test Wellington’s Sole Traders As Government Support Drops

Economic concerns are front and centre for Wellington’s sole traders, with 42 per cent saying the Government’s reduced use of consultants - particularly individual contractors who work for themselves - is hitting the city hard and 41 per cent rating the health of the capital’s economy as poor or very poor

The latest Sole Trader Pulse survey, conducted by Hnry - one of New Zealand’s largest accountancy firms supporting sole traders, contractors, and the self-employed- highlights Wellington still has challenges as 2024 comes to a close.

Senior Ministerial Advisor Harley Hepetema says 2024 has been a “brutal” year. Over the past 12 months, he’s worked across three different contracts, navigating widespread job cuts in the public service. Some of his peers have taken fixed-term or permanent roles to weather the downturn.

“Change at pace is nothing new for us,” Harley says. “Sole traders are used to pivoting as needed - that’s one of our strengths. What stands out in tough times like this is the support we offer each other. We understand the uncertainty and can openly share our concerns with each other.

“We’re hopeful for 2025 as the workforce stabilises, but right now, the mood is tired. Many of us feel overworked,” he says.

While more than 40 per cent of sole traders say they've been impacted by the reduced use of contractors, 53 per cent reported higher turnover in the previous quarter. Pilates instructor and circus performer Laura Oakley says despite the ‘wild’ cost of living, wellness has remained a priority for her clients

“Due to a rise in our costs at the studio, our class prices increased this year. I was unsure about how people would react, but class numbers have stayed steady, providing me with stability. Flexible working arrangements have helped - people have more choice about when they can come to the studio,” Laura explains.

She’s also thriving as a circus performer, with bookings secured through the end of the year and into 2025. However, she remains cautious.

“Christmas is coming, and I expect people will tighten their belts to afford everything. February will be the real test when we put on our Fringe Festival show. I’m hopeful people will still have disposable income to spend on live events, but if more people are made redundant in Wellington, there’s a chance we’ll see a drop-off,” she says.

For Iain Saunders, self-employment has been a silver lining in 2024. After retiring from the police last year, he transitioned into sports psychology - a career shift carefully timed amid looming public sector job losses.

“It was now or never,” he says. “My wife works in the public sector, so we saw what was coming. Setting up my business ahead of the spending cuts was the best decision we’ve made, as there’s constant demand for mental health services.

“I now work remotely from Kāpiti Coast and travel the country. The freedom is incredible—I couldn’t return to working for someone else. That said, Wellington’s uncertainty is visible across hospitality and retail, and many people feel nervous about what’s next.”

The survey also revealed declining confidence in the government. Only 20 per cent of sole traders said the government's actions are positively impacting businesses—a sharp drop from 46 per cent a year ago. A third of respondents believe the government doesn’t understand their needs.

Hnry CEO James Fuller says the findings reveal micro-economic trends across our largest centres.

“Wellington has been hit hardest by public sector cuts, while Auckland and Christchurch appear more insulated. While some sectors within Wellington are doing better than others, there’s still a ripple effect of instability.

“However, what’s great to see is the resilience of Wellington’s sole traders. They’ve all chosen to work for themselves and continue doing so during difficult circumstances because of the freedom and flexibility it provides - whether that’s being able to control their work-life balance, increasing rates if needed, or seeking work outside of Wellington to supplement their income. We can see quiet optimism amongst the current doom and gloom, which is encouraging,” he says.

Hnry’s latest Sole Trader took place between the 2 and 15 October 2024 and has a maximum error margin of +/-4.4%.

About Hnry:

Founded in 2017, Hnry is one of New Zealand’s largest accountancy firms. It provides a pay-as-you-go all-in-one digital accounting service handling invoicing, expenses, payments, taxes, filings, and expert on-demand support. Hnry takes care of all the financial admin for contractors, freelancers, sole traders, and the self-employed, allowing them to focus on getting the job done rather than worrying about tax and compliance. Hnry recently won the ‘Innovation in Financial Services’ category at the 2024 INFINZ Awards. In 2023 and 2024, as well as being one of the leading companies in the Deloitte Fast 50, it was also recognised as the Fastest Growing Technology Business in Wellington and the lower half of the North Island.

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