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New Zealanders need to embrace the idea of "creative destruction" as the economy enters the most difficult phase of the pandemic, says BNZ chief economist Paul Conway.
Conway, who spent seven years with the Productivity Commission, was appointed BNZ chief economist earlier this year.
New Zealand had done a good job and of managing the first phase of the pandemic and that had enabled the economy to perform better than many expected, he told 'The Economy Hub'.
But the coming year would be tough as the country got into "the grit of the structural change", he said.
"Businesses are going to the wall, people are losing their jobs, we're really in the throes of that difficult period."
"As economists, we think fo this as creative destruction and we're very much in the destruction phase at the moment."
In terms of the economic cycle there was some truth to the idea that things were darkest before the dawn, he said.