Union fears more layoffs after jobs slashed

Last updated 05:00 25/09/2012

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Unions fear more workers will be laid off after more than 500 jobs were cut in the latest round of layoffs.

State coal firm Solid Energy announced sweeping staff cuts yesterday, including the axing of some executive jobs and 222 staff and 130 contractors at Spring Creek on the West Coast. The radical revamp would shrink its staff numbers by 25 per cent to 1360 from 1800 at the beginning of the year.

Fellow government-owned KiwiRail has kicked off a consultation process with staff after confirming it will cut 158 jobs from its infrastructure and engineering division around the country.

Sharemarket-listed trans-Tasman chemicals manufacturer Nuplex will shut four plants in New Zealand and Australia, while refurbishing four others in response to lower levels of demand on both sides of the Tasman.

The closures will see the firm shed almost a tenth of its 800strong Australasian workforce. Layoffs in manufacturing were further evidence the sector is in distress, but are not a cause for economic alarm bells, commentators say.

The Engineering, Printing and Manufacturing Union says paper maker Norske Skog is expected to announce soon a possible 120 job cuts.

In other recently announced cuts, Rio Tinto's Tiwai Pt smelter will shed 100 jobs by November, and North Island Mussel Processors 220 fulltime and seasonal staff.

Official figures show 246,500 people were employed in manufacturing in June, up 0.7 per cent on June last year.

Prime Minister John Key said yesterday that the cuts did not mean the country's economy was failing.

He said he doubted the decision to cut jobs was made lightly.

"There's always been industries going through rough periods or technological change," he said.

KiwiRail and Solid Energy were struggling, but for different reasons.

"In the case of Solid Energy, it's a victim of falling commodity prices. The issue isn't that we're not on their side, the issue is that international coal prices aren't on their side."

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- BusinessDay.co.nz

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