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WHY NZ FACTORIES ARE SINKING IN 2009

MANUFACTURING IS MOVING TO THAILAND AND NZ HAS LOST THE PLOT

AS HIGH SALARIES, MORE BLUE COLLAR WORKERS OUTSTRIP THE NORMAL

LABOURER AND FACTORY WORKER

The relocation of the Fisher & Pykel saves about $6 million a year, with a one-off cost of about $5 million - both at a pre-tax level. The savings would mainly come from wage costs, BOI incentives but also cheaper sources and closer proximity to materials and better export shipping costs unlike NZ shipping and transport costs. So it makes sense to move to a better employment climate as NZ cannot compete with Asia fullstop. Bruce Goldsworthy, of the Employers & Manufacturers Association Northern, said the relocation was not really a surprise. He said the move reflected "the international nature of the company and the international nature of the product and the fact that we are part of an international market". He said it was not all bad news. A recent survey showed that a shortage of skills was the biggest issue facing local manufacturers but in reality NZ can not longer compete and many skilled workers cannot now get jobs in NZ. The influx of skilled workers from the Uk retuning home in 2009 indicates this as NZ Companies are now downgrading, stretching their work roles wider for those employed mainly because of the costs, shorter hours or days, union intervention and Government tax issues which make life harder. The company had looked hard at dividing the electronics operation between New Zealand and Thailand "but at the end of the day the economics ruled it out unfortunately". It makes total sense and the savings are phenomenal moving to Thailand due to the incentives of BOI (Board of Investment) , tax relief etc and manuafcturing costs. Free trade was good for New Zealand, although Bongard would prefer agreements with countries like Canada, US, Japan and Europe but the costs of transport etc make even exporting, shipping being one of the highest in the world . NZ has 30% containers in and out empty and the wharfage costs, transportation movement costs are over the moon. Yes we have bascially cost ourselves off the planet. ACC levies for employers, OSH restrictions, utility costs which change and high salaries before even thinking about transportation and usage costs make life in manufacturing a disaster and this cannot be now revere unless salaries and costs drop & the regualtions are deregulated which will never happen. In a nut shell NZ like many other western countries have gone beyond the bounds of cheap goods and services & unfortunately only a deduction to Asian standards will make NZ a viable manufacturing sector again?? but alas it will never happen.

Reflecting the entrenched nationalism and pro-employer sympathies of the entire union bureaucracy, New Zealand's local manufacturers are simply victims of political decisions to reduce tariffs on imported goods. The reality is that shifting manufacturing to a lower-cost country not only lowers the wage rates, but also the other non-wage expenses of the "fully burdened cost". NZ is totally over-regualted and the manufacturing businesses are taxed beyond a joke so it does not help matters when one wants to employ and setup a manufacturing business with all the crazy rules that have been imposed. NZ is now a country for the blue collar jobs and theres no hope for unskilled workers apart from the benefit or going back to work skills and relearning which a lot of young ones now realize.

WORKERS AND BENEFITS WILL INCREASE:

In just 12 months over 52,000 additional Kiwis have signed on for benefits, Labour Social Development spokesperson Annette King says.“It is extremely concerning that an additional 52,000 people in a single year have signed on for benefits meaning there are now more than 310,000 Kiwis reliant on the Government for their income"., But she does not realize factories are closing down as they cannot compete here with labour laws, taxes, high kiwi $$ and shipping & transport costs gone out the door. It won't stop there. Of 14 working people in NZ 1 is on an assistance benefit and it will increase as we are flooded with Chinese goods from every angle so factories will all close apart from: dairy, wines, meat exports.

“The real numbers of people losing their jobs is reflected in an increase in all benefit categories,”
• An additional 33,000 people on the unemployment benefit since this time last year.
• Nearly 8000 more people on the DPB
• Nearly 2000 more people on the invalids benefits
• Over 8000 more people on the sickness benefit
• Over 1000 more people on other benefits

“These figures show there are significantly more unemployed than first thought, obviously single parents who lose their jobs end up on the DPB not the unemployment benefit, while anyone with a disability who becomes unemployed may be put on to the sickness or invalids benefit.“This worrying increase in beneficiary numbers shows just how far in denial the National Government is about unemployment in this country. John Key and Bill English have given up on stopping New Zealanders ending up on the benefit numbers and they still have no plan for the country’s recovery. National has refused to lift caps on tertiary student numbers, has cut the Training Incentive Allowance for those on the DPB and has made funding cuts to night classes that will actually see more people lose their jobs. “Bill English and John Key have crowed about the fact that despite the recession they haven’t cut benefit entitlements. But the reality is they have cut everything else that could help to get Kiwis back to work,” Annette King said and she forgets: Under the last Clark-Cullen Labour government some 300,000 families were forced onto the 'Working for Families' welfare handout in order to live.