Masterminding a new way to save jobs

BY JOAN WITHERS

OPINION: The prime minister's Summit on Employment this week is a rare opportunity for the public and private sector to work together to find ways to save jobs at risk from the economic crisis.

The full effects of the recession are only just starting to unfold in New Zealand, and protecting jobs and promoting employment are priorities.

The scale and speed of the downturn call for a new approach, one that brings business, workers and the Government together in a united front.

Through the chairman of the summit, Mark Weldon, the prime minister has galvanised into action a cross-sectoral group which is working on developing, refining and quantifying the impacts of a range of initiatives that can be implemented quickly and that will make a real difference in the next 24 months.

There are six summit work streams, each focusing on a different area helping firms survive, business investment, funding for firms, the Maori economy and local and regional funding, the workplace and core employment funding, and the stream that I am co-chairing with Stephen Tindall Workers: skills and transition.

Our workstream is charged with finding innovative solutions to retrain, reskill and manage the transition into new jobs.

Large pools of unemployed can lead to "structural unemployment". This is long-term and chronic unemployment that arises from mismatches between the workers looking for jobs and the jobs that are available.

Lack of the right skills and a dearth of strategies for getting people back into employment can prevent some from finding work in a fast-changing job market.

We are also focusing on areas such as encouraging apprenticeships, finding ways to support people to stay in work, providing broader and deeper services to speedily assist those facing redundancy, and looking at strategies to work with those groups which have historically been most affected in times of high unemployment.

New Zealand's unemployment rate has, in recent years, been at historic lows and the forecasts at this stage still suggest that the peak this time will not reach the 10.9 per cent level attained in 1991.

However, there will be significant job losses around the country and there is a real risk that the forecasts are undercooked.

As we have seen overseas in recent weeks, the picture can alter very quickly if big employers are forced to close or shed large numbers of staff.

New Zealand's employment profile is interesting, in that most businesses here are small in scale 97 per cent of them employ fewer than 20 staff.

In terms of bigger enterprises, only 0.5 per cent or 2200 businesses here had 100 or more employees in 2008 but those businesses employ 47 per cent of all private sector workers.

So there is a high concentration of people employed in the private sector in a relatively small number of enterprises. The public sector employs 25 per cent of all workers.

This is the most pronounced downturn I have seen in almost 30 years working in the media and in business.

In many ways the media is at the "bleeding edge" of an economic downturn because business sentiment is fairly rapidly reflected in a company's propensity to spend, particularly on marketing and advertising for new staff.

These insights have heightened my awareness of what the short- and medium-term impacts may be on the economy and on New Zealand communities.

At Fairfax we employ about 2500 New Zealanders up and down the country and our network of newspapers, our stable of magazines and our online sites are intrinsically interwoven with the communities they serve.

We are enormously optimistic about New Zealand's future and its potential.

This economic maelstrom requires us to work together across the public and private sectors to find solutions to the issues we are facing and also to enhance our ability to address the long-term fundamentals that will drive economic growth and productivity. So the summit is a really important piece of work.

I have been mightily impressed by the amount of time and energy that is being put in and by the commitment across a very diverse group of participants to make this event achieve its objectives.

If this culture of collaboration can continue to be harnessed, New Zealand has the best possible chance to weather this economic crisis and achieve stability and growth in the future.

* Joan Withers is chief executive of Fairfax Media in New Zealand.

 

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