Different views on the state of manufacturing


Prime Minister John Key and the National Party reckon there is little wrong with the manufacturing sector that the government has not addressed, citing recent figures suggesting the sector has turned the corner and is on the way out of recession. Opposition leader David Shearer says there is plenty of work to do yet and uses the agreement reached with other parties to reinforce the case. He sets out the consensus view here.

We have seen a new consensus emerge on the future of our manufacturing sector.

It involves a coming together of political parties, businesses and workers all dedicated to creating the best environment for our manufacturers so they can flourish.

Late last year Labour, the Greens, New Zealand First and the Mana Party joined together to set up a Parliamentary Inquiry into manufacturing. We heard submissions from 128 manufacturers, workers and business groups across the country.

We released the results of that inquiry in a major new report that provides a blueprint for better jobs and higher wages through a thriving manufacturing sector.

It’s not full of political jargon. It makes recommendations that will make a real difference. And we know that, because the ideas come directly from the manufacturers themselves.

Manufacturing is vital to our economic prosperity. Every $1 of turnover in manufacturing creates $1.74 turnover in the wider economy. Every job created in manufacturing has a flow-on effect, creating another 2-5 jobs in related industries. These are high-value jobs.

But the manufacturing industry in New Zealand is at tipping point and, if the government continues to deny there’s a problem, we will see irreparable harm done to our economy as a whole.

Last year 17,000 jobs were lost in manufacturing – more than 40,000 in the past four years. About 1600 manufacturing firms have gone out of business.

The government says businesses just need to be more efficient.

We say that governments around the world are making sure their exporters and manufacturers have an advantage and it’s time to back our industry here.

The changes a Labour led government will make include tackling our overvalued and volatile dollar by overhauling the Reserve Bank Act and making a competitive currency a priority, encouraging innovation through a better tax system with research and development tax credits to stimulate innovation and giving Kiwi companies the first crack at big government contracts so they can build strong businesses to go on and export successfully.

New Zealand needs a diverse and innovative economy that creates high-value jobs. Manufacturing is at the heart of that.

It’s about smart, active and hands-on government – backing our businesses so they can sell their products to the world and contribute to a strong economy that benefits all New Zealanders.