David Thompson Posted:
So very, very true. It beggars belief that we consider ourselves to be a developed nation when so much of our economy is based on selling milk powder or logs. BTW, I own a Plinius amplifier (my second) that drives a set of Theophany speakers.
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David Thompson Posted:
A robust but sobering report. It concerns me that confidence is rising, yet sales and exports are down and "manufacturers and exporters are still lagging behind other sectors". Surely we should wait until we're earning more money before we start spending more?
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siemens Posted:
Yes true! The only thing that will never die in this world is the nature and its science behind it. Great post.
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Kieran Ormandy Posted:
Thanks for the question Steven, Germany has seen increases in manufacturing employment since 2009, and Switzerland has had stable manufacturing employment between 2006 – 2011, even in the face of ongoing Euro-zone issues. Korea has seen increases in manufacturing employment since 2008 and Israel experienced large increases since 1998, while being stable over the last 4 years. Singapore has had increases in manufacturing employment over the last two years. These countries all value their manufacturing sectors and work to protect them, this is reflected in the above numbers and their performance through the GFC. Note data around the above examples was sourced from OECD labour market stats.
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John Walley Posted:
Point one: you should have no doubt what our Association says publically represent the views of our members. Point two: we don’t knee jerk responses, if you trace back our comments around NZPower you will see them link all the way back to our research in 2004 and 2005. All that material is fully linked from our comments above. Point three: you will note our comments on major users, sadly the same advantage does not accrue to smaller industrial users. The perverse incentives of the LRMC approach in all this are well known. Point four: the NZMEA is not like any other Association in New Zealand we admit only manufacturers and exporters into membership, and our public expressions are the views of that restricted membership.
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Survey - Sales Improve

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The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during August 2010, shows total sales in July 2010 increased 16% (export sales increased by 15% with domestic sales increasing 18%) on July 2009.

The NZMEA survey sample this month covered NZ$348m in annualised sales, with an export content of 39%.

Net confidence rose to 30, up from the 0 result reported last month.

The current performance index (a combination of profitability and cash flow) is at 103.5, up from 99 in June, the change index (capacity utilisation, staff levels, orders and inventories) went down to 101 from 103 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 105.5, down on June’s result of 107. Anything less than 100 indicates a contraction.

Constraints reported were 75% markets and 10% capital and 20% skilled staff.

Staff numbers for July increased year on year by 7%.

“The combination of more substantial sales growth and a lift in confidence is encouraging,” says NZMEA Chief Executive John Walley. “Earlier in the year we had a ‘dead cat’ bounce with confidence surveys predicting a strong recovery, but this set of statistics with sales and staff numbers increasing is far more convincing. Increases in export sales add substance to the recovery.”

“The future expectations and index numbers confirm this upward trend.”

“Markets have remained a major concern and this presents the biggest threat to the recovery. If the United States and Europe experience a double dip recession there is every reason to expect we will be dragged down with them. Some decent growth numbers in Asia will not be enough to sustain our export sector on their own. With a return to hiring in the manufacturing sector we are also starting to see some skill shortages in key areas.”

“A third Official Cash Rate rise in September has the potential to add to the damage done by the earlier increases and to further destabilise any recovery. The RBNZ tightened far too early and a pause has now been signalled, any failure to follow through will be costly.”

“The work of the Savings Working Group should be positive for manufacturers as this represents a major source of our economic problems, but the restrictions imposed by the terms of reference will limit its effect. It is difficult to assess the savings problem without looking at tax issues which determine where savings are likely to be invested and superannuation entitlements which determine how and when savings will be spent. There is little point setting up these working groups if they are not allowed to conduct a full analysis of the issues and if findings are largely ignored as they have been with earlier working group reports.”

“If we save more but returns on domestic investment are poor due to fiscal policy distortions, then higher savings would rightly be invested offshore. Such an outcome would do little for domestic growth and jobs. We need complete answers if progress is to be made.”


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tags: survey, savings working group, ocr, double dip recession


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