Unions fear new job losses

VERNON SMALL AND HAMISH RUTHERFORD
Last updated 08:14 14/02/2013

Relevant offers

National business

Christchurch concrete business nearly wrecked by employee who stole thousands Nigel Latta: The NZ paradox - why are we poorer despite doing everything right? Rebranding a business for competitive advantage Investors sought for global expansion of remote-controlled boat launch device Two Canterbury quarry operators appeal after failed bid to dig deeper Spark customers call for information on major security breach Dotcom Mansion's new owner revealed, but who's going to be moving in? Brighter future predicted by sustainable business report Legendary Auckland music venue Kings Arms goes on the market, music fans howl and developers prowl Westpac customer Shay Speers says bank left him stranded after fraudsters hit his account

Unions are warning another round of more significant redundancies could be announced in days following news power company Contact Energy will shed 100 of its 1100 staff.

Engineering, Printing and Manufacturing Union national secretary Bill Newson said this morning he knew of one decision that had been made, and would be announced as early as today.

Another was pending, although no final decision had been made and he hoped the job losses could be averted.

He said he could not name the companies because the union received information in confidence.

"This is serious stuff."

The news of job cuts at Contact comes on the heels of news 192 jobs will go at Summit Wool Spinners in Oamaru and about half the 400-strong workforce at Mainzeal face redundancy after the construction firm was put into receivership.

National and Labour have both made jobs their main focus this year. The latest data shows a fall in unemployment to 6.9 per cent but also a sharp drop in the participation rate suggesting the labour market is weak.

The job losses at Contact are being partly blamed on weak energy demand, but manufacturing companies have told an Opposition-initiated inquiry the high New Zealand dollar is also curbing investment and harming profits.

Finance Minister Bill English yesterday said bosses calling for a lower dollar want to cut workers' wages.

He told Parliament's finance and expenditure select committee: "What they're actually telling you is they want to cut the real wages of their workers, because that is the other side of the equation. They want to cut the real wages of their workers," he said.

"The workers need a voice in this debate because no one is sticking up for the fact that the exchange rate underpins household living standards."

But John Walley, who heads the New Zealand Manufacturers and Exporters Association, said that while it was "undeniable" a weaker currency hit consumer purchasing power, manufacturers were concerned about their ability to operate in this country.

"You don't worry much about purchasing power if you don't have a job," Walley said.

Manufacturers were concerned that the high dollar, which makes our exports more expensive overseas, could push them out of business.

"It doesn't matter what the wages are, we won't be here to pay them."

Labour finance spokesman David Parker dismissed English's comments as "nonsense".

"What [manufacturers] want is an exchange rate which enables them to compete internationally so they can afford to pay wages," he said.

"The idea that an artificially high exchange rate is good for New Zealand workers because it holds down the price of flat screen TVs is a nonsense if they can't earn a decent wage."

Ad Feedback

- BusinessDay.co.nz

Special offers

Featured Promotions

Sponsored Content