Do performance metrics of self-identifying Māori firms differ from non-Māori firms?

The Māori economy is an increasingly important contributor to the wider New Zealand economy, with an estimated asset base of at least $68.7 billion in 2018. Nicholson Consulting (2020) uncovered more than 10,000 economically significant Māori-owned businesses (excluding sole traders), representing 6% of all businesses with active shareholders across New Zealand. Stats NZ’s Tatauranga Umanga Māori 2019 reported record profits in Māori farming businesses and the Productivity Commission’s frontier firms inquiry noted how tikanga values and “multiple bottom lines” can drive innovation and growth. Success in the Māori economy can diffuse through the national economy and improve both Māori and non-Māori prosperity. This paper examines the performance, productivity, and growth dynamics of self-identifying Māori firms surveyed in the Business Operations Survey (BOS) relative to that of non-Māori firms using Stats NZ’s longitudinal business database (LBD). The study population comprises of longitudinally matched Māori firms with non-Māori firms surveyed in BOS, based on their respective age, size, and industry characteristics. Pooled regression models estimate Māori firms have 6.3% lower labour productivity than matched non-Māori firms, but this isn’t fully reflected in wage and salary earnings. Wage and salary earnings per employee are only 2.6% lower in Māori firms, thus comprising a greater relative portion of Māori firms’ value added. Growth dynamics are not significantly different between Māori and non-Māori firms but industry differences are, particularly in agriculture and certain services sectors.