Employment prospects and new orders provided the only positives in an otherwise mixed outlook for the service sector last month.
The BNZ-Business New Zealand Performance of Services Index fell 2.7 points to 51.5.
A reading above 50.0 indicates the service sector is generally expanding; below 50.0 it is declining.
The 2012 average was 53.8, providing an almost identical December result to 2011.
All but one month (August) were in expansion and Business New Zealand chief executive Phil O’Reilly says the industry has held up well despite another difficult trading year.
The second half of the year provided mixed results and ended with more of a whimper than a bang.
“Globally, the service sector has shown incremental improvements over the latter half of 2012, which should bode well for on-going growth trends in 2013," he says.
"Whether we see this uplift in New Zealand remains to be seen, given the domestic services index has shown patchy growth for a number of months.”
BNZ senior economist Craig Ebert says the most positive message to take from the December results is in the jobs growth area.
And he says there is good reason to believe employment growth is in the throes of picking up. He expects it may lift by as much as 2% this year, or an additional 45,000 jobs.
The northern region proved the most positive in December, recording 53.7, while service sector activity in Canterbury/Westland was at the lowest level – 47.1. That was a recovery from a November fall.
Last week, the BNZ- Business New Zealand Performance of Manufacturing Index showed a December reading of 50.1, reflecting a somewhat flat feeling for manufacturers.