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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Sales flatten out but jobs still under threat

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The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during January 2010, shows total sales in December 2009 decreased 6% (export sales decreased by 7% with domestic sales decreasing 4%) on December 2008.

The NZMEA survey sample this month covered NZ$482m in annualised sales, with an export content of 42%.

Net confidence rose to -11, up from the -23 result reported last month.

The current performance index (a combination of profitability and cash flow) is at 101.5, up from 98.5 in October, the change index (capacity utilisation, staff levels, orders and inventories) went down to 101 from 103.75 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 98, down on the previous result of 101. Anything less than 100 indicates a contraction.

Markets were the only reported constraint.

Staff numbers for December decreased year on year by 17%.

“Sales look to be bottoming out for manufacturers, with markets picking up, albeit in patchy fashion,” says NZMEA Chief Executive John Walley. “However, staff numbers are continuing to track down as those firms in poorer performing markets continue to shed staff and those in better markets take advantage of spare capacity rather than hiring. The higher than expected unemployment rate of 7.3% announced by Statistics New Zealand yesterday reflected this trend.”

“Confidence has improved again but comments about uncertainty still dominate. The uncertainty surrounding the recession means that purchase orders generally remain short-term. This leaves many firms living on a month to month basis. On the investment side many firms have identified research and development projects, but remain unwilling to invest while policy settings hold up the currency.”

“The Government’s intentions to follow through on the advice given by the Tax Working Group in this year’s budget to broaden the tax base to include property, and to incentivise saving with a higher GST rate are a start. Hopefully we will see more action around the findings of the Capital Market Development Taskforce as well, because these are the sort of changes that encourage firms to invest further – the real economy matters and policy has long ignored that point.”

“The glaring omission from advice sought by the Government last year was any effort around stabilising the New Zealand dollar. It is notable that as the dollar has become increasingly volatile over the past decade, investment intentions and confidence throughout the tradeable sector have slowly ebbed away.”

“A more even-handed tax system and monetary policy reform are necessary to see firms investing in export development and jobs.”


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tags: survey, jobs, investment, tax


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