Australians export jobs to NZ

MADELEINE HEFFERNAN AND TOM PULLAR-STRECKER
Last updated 05:00 18/04/2012

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Hundreds of Australian jobs have been shifted to New Zealand as producers there try to avoid the impact of high wages, a soaring dollar and restrictive labour laws.

Supermarket giant Woolworths is the latest to transfer jobs across the Tasman, shifting 40 contact centre jobs to Auckland this week.

Imperial Tobacco has also said it will move cigarette manufacturing from Sydney to New Zealand.

The companies are following in the footsteps of the food production industry, which has been shifting jobs out of Australia to take advantage of New Zealand's lower wages.

Heinz Australia recently scrapped more than 300 jobs across three states in favour of its large plant in Hastings.

According to the International Labour Organisation, Australian manufacturing workers earned more than US$35 an hour in 2008. In New Zealand, the rate is under US$20 an hour.

Average weekly earnings for manufacturing workers in Australia are higher than those in Canada, Britain, New Zealand and the United States, according to a study that put Australian earnings at more than A$1000 a week, compared with about A$700 in New Zealand.

Woolworths' contact centre jobs have been outsourced to call centre operator Salmat, ironically to support a service that it offers in Australia but not in New Zealand.

The Salmat staff provide phone support for customers of Woolworths Money, which was launched in 2008 and provides branded credit cards, pre-paid debit cards and insurance products.

A spokesman for Woolworths – which owns the Countdown supermarket chain – said it had no immediate plans to launch Woolworths Money in New Zealand.

High wages, penalty rates and productivity of Australian workers have all come under attack in recent months.

Toyota Australia chief executive Max Yasuda criticised the culture of his workforce at Altona, Melbourne, saying absenteeism could be as high as 30 per cent.

Earlier this year, Finance Minister Bill English said New Zealand was benefiting from a more flexible industrial relations environment.

"[It] has enabled quite a lot of flexibility to our manufacturing sector, which has in the last while been growing, despite the high dollar," he said.

Hastings Mayor Lawrence Yule said he believed New Zealand's "more holistic view on employment" had boosted its appeal to Australian companies such as Heinz, which is returning production of tomato sauce to Hastings, increasing production there by 10 to 15 per cent.

Mr Yule cited lower levels of unionisation, the ability to operate outside traditional daytime hours, and greater use of seasonal employees.

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"Our labour laws are more relaxed, as I'm told."

Peter Burn, director of public policy at Australian Industry Group, said New Zealand had not followed Australia in "tightening" its industrial relations settings, and its labour laws could prove to be "the straw that breaks the camel's back" for some companies.

"Labour laws in themselves aren't going to be the 'knock them down' difference, but it could make a difference at the margins."

Jessica Ramdsen, a spokeswoman for HJ Heinz Australia, said the now-closed plant in Girgarre, Victoria, was small by global standards, and the required investment to make it competitive was too great.

She acknowledged differences in labour conditions between the countries, but said they did not play a role in the decision.

Jason Hefford, of the Australian Manufacturers Workers' Union, said shifts to New Zealand were "definitely a concern", but he pointed to the high Australian dollar and occupational health and safety obligations as more significant than high wages.

- The Dominion Post

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