Cuts to the public sector saw Wellington's GDP slow to 0.8 percent in 2011, lagging behind national growth of 1.6 percent.
Infometrics' Annual Economic Profile report commissioned by economic development agency Grow Wellington attributed this to reduction in the government sector which in turn saw a decline in the business services sector.
On the other hand, Wellington outperforms all regions on GDP per employee at $78,719 compared with a weighted average of $64,898 and boasts the most knowledge intensive industries in the country.
Grow Wellington chief executive Nigel Kirkpatrick said it was important to focus on growing Wellington's high-value sectors.
Approximately 39.6 percent of Wellington's workforce is employed in highly skilled occupations. This is higher than in the national economy (36.2 percent). Tertiary industries accounted for the largest proportion of GDP (81 percent), again beating the national economy (65 percent).
Nearly half of the region's workforce is employed in knowledge intensive roles compared to a national average of just over 32 percent.
Infometrics said the industries in which Wellington has the largest comparative advantages are central government admin and defence, communication services, and cultural and recreational services.
Manufacturing, education, food and beverage, screen and digital, information technology and clean technology have all grown above the national average; the food and beverage and screen and digital sectors grew at almost double the national rate.
Compared with 10 years ago, the report shows the IT and biomedical sectors are now contributing more to the region's economic output while screen and digital, primary, manufacturing and education's contributions have declined.
In that time, both the national and Wellington economies have become less diversified overall.
Last year, business and property services was the largest industry in Wellington, accounting for 16 percent of total GDP and 19.6 percent of total employment.
The second largest industry was wholesale and retail trade followed by finance and insurance.
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