Comments

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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9/6/16

April exports fall, mixed feelings from manufacturers


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The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during May 2016, shows total sales in April 2016 decreased 2.97% (year on year export sales decreased by 5.36% with domestic sales increasing by 2.72%) on April 2015.

In the three months to April, export sales increased an average of 24.8%, and domestic sales increased 2.2%.

The NZMEA survey sample this month covered NZ$311m in annualised sales, with an export content of 69%.

Net confidence rose to 40, up from 33 in March.

The current performance index (a combination of profitability and cash flow) is at 99, down from 103.33 last month, the change index (capacity utilisation, staff levels, orders and inventories) was at 101, down from 103 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 102, down on the last result of 107. Anything over 100 indicates expansion.

Constraints reported were 53% markets, 20% skilled staff, 20% production capacity, and 7% capital.

A net 46.67% of respondents reported productivity increases for April.

Staff numbers for April increased 2.68% year on year.

Operators/labourers, tradespersons and, managers, professional/scientists reported a moderate shortage and supervisors reported a minor shortage.

“April showed a decrease in year on year export sales, following a great start to 2016. Even with this fall, the three month average of export sales remains high at 24.8%. Domestic sales increased year on year by 2.7% in April, which is positive after the decrease seen in March. The three month average for domestic sales stayed positive at 2.2%.” says Dieter Adam, Chief Executive of the NZMEA.

“Sentiment measures were mixed this month, with confidence improving, but the index measures of performance, forecast and change, all falling on March results. Skilled staff has also increased significantly as a reported constraint to growth, moving from 6% in March, to 20% this month.

“The recent budget announcement has some positive notes on skills development and apprentices, as well as for innovation, but we would have liked to see a bigger focus on R&D within businesses. Preferably through R&D tax credits, which has a wider scope for encouraging and supporting R&D spending by manufacturers.

“In addition, we would still like to see more action on the housing front, to tackle both the demand and supply sides. Recent data from the RBNZ showing investors making up 46% of mortgages in Auckland in April highlights the need to better balance the investment and tax incentives involved. It is great to see the RBNZ look into debt-to-income measures.

“The Reserve Bank of New Zealand (RBNZ) held the OCR today, despite a currency that has risen two cents on a TWI basis this month. They noted the level of the currency remains higher than appropriate and that a lower dollar would assist the tradable sector.

“Manufacturers and exporters need the downward trend to a fairer level to continue, rather than these movements in the opposite direction. The RBNZ’s hands cannot be tied by housing inflation when making monetary policy decisions that affect our exchange rate and manufacturers and exporters competitiveness.” Said Dieter.

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