NZQA level 3 statistics AS91580 Time Series

1 Bruce Tan Hamilton Boys High School The overall trend of NZ motels and accommodations Problems/Plans The accommodations, in various forms, have always been an important part of the NZ economy, it can be called with certainly the fastest emerging and becoming extremely powerful on international business arena. In order to better understand the future of the industry, we need to predict the guest nights of accommodations.

There is a recession started at 2007, which is called 2007 financial crisis1. It certainly has impact on the economic accommodation industry. As economy falled down, less people were in employment, thus households had less disposable income to spend on goods, consumption for accommodation decreases2. However, as the recession stops, more people are in employed, accommodation industries are expected to rise. As demand was low and supply was high during the recession, the price of accommodations drops3, the lower price of accommodations could act as a trigger to get the recession left.4

Another big event is the NZ World Rugby Cub, researchers have investigated a strong relationship between foreign visitors and accommodations Occupancy Rate.5 The world cup affect the accommodation consumption, that more tourists need to find a place to stay. With more revenue, the business confidence increases, the supplier are more likely to increase productivity and employ more workers, which can have a positive impact on the NZ economy.6

The purpose of this investigation is to see how those two events have an impact on the accommodation industry of New Zealand, and whether there is continuous effect on it.

Data The data of accommodations are from New Zealand Statistics website, the values are guest nights, equivalent to one guest spending one night at an establishment. For example, a motel with 15 guests spending two nights would report provision of 30 guest nights of accommodation.7

The response variable I choose is Motel Guest Nights, in guest nights, recorded quarterly over the whole year. In addition, I will compare the Motel Guest Nights and Motel Occupancy Rate, as well as the total accommodations overall.

Time Series Plot

1 http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%9308

2 http://www.scribd.com/doc/18798142/Impact-of-Recession-on-Hotel-Industry

3 http://www.investopedia.com/university/economics/economics3.asp

4 http://www.stuff.co.nz/business/industries/economy/2582788/Cheap-accommodation-gets-recession-lift

5 https://www.boj.or.jp/en/research/wps_rev/rev_2013/data/rev13e04.pdf

6 http://economics.about.com/od/economics-basics/ss/The-Circular-Flow-Model.htm

77http://www.stats.govt.nz/browse_for_stats/industry_sectors/accommodation/AccommodationSurvey_HOTPDe

c11/Definitions.aspx 2 Bruce Tan Hamilton Boys High School Looking at the time series graph for Motel Guest Nights. On average, the overall trend of the total motel guests nights is increasing. It is increasing from 1.995 * 10^6 to 2.87 * 10^6 motel guest per night. The increasing amount of motel guest nights is not bad and looking at the data the motel guest nights increases until 2007 and then decreases until 2013. The total beer consumed increases at the rate of about 79636 motel guest nights from 1997 to 2007 in 11 years; and it decreases at a rate of about 21666 motel guest nights, from 2008 to 2013 in 6 years. The increasing rate (1997 to 2007) is comparatively higher than the decreasing rate (2008 to 2013), in addition, the drop at 2008 due to financial recession8 is probably due to financial recession. Thus less people are in employment, they have less disposable income to spend, thus less spending on the motel, as well as less car purchasing. However, the decreasing rate is smaller than the increasing rate, this means the recession does not cause a large damage to the industry.

There is a peak and at 2008 at about 2.87 * 10^6 motel guest nights, and then decreases to 2.7 * 10^6 motel guest nights in 2009. This sudden decrease is caused by recession started at 2008. This is due to the financial recession, as people have less disposable income to purchase cars and spend on motels.

This recession continues until 2010. Reaching it lowest point after financial recession at about 2.5 * 10^6 motel guest nights. After 2010, the motel guest nights start to increase steadily, but at the

8 http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%9308