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    Letter No.62

    25 June, 1997

    The European Union last week unveiled a radical new strategy for tackling the European jobs crisis, one which is a marked departure from the "hands-off" approach by `Anglo' countries (such as the UK and the US) over unemployment. The Amsterdam EU summit approved a package of measures to boost jobs and growth, while also sticking to their target for monetary union in January 1999. The package includes large-scale investment in small businesses and developing specific job creation projects. The summit also underlined its commitment to making employment its top priority when it ratified a jobs chapter in the new European Union treaty. It will hold a special summit in Luxembourg later this year to study ways of putting some of Europe's 18m unemployed back to work.

    The new jobs package is backed by a $1.1 billion loan facility from the European Investment Bank (EIB). EU leaders have called on the EIB to boost investment in major infrastructure schemes and hi-tech projects, as well as examining "its scope of intervention" in the areas of education, health, urban environment and environmental protection. The Bank is in effect being asked to shoulder part of the financing of "socially useful employment" projects together with governments and the private sector.

    Source The Guardian Weekly 22 June 1997 "Jobs deal keeps EU summit sweet" by John Palmer and Michael White

    The new EU jobs package comes during a sudden spurt this month of announcements of new company lay-offs on the European continent, the numbers of which are large enough to be compared to the EU proposals on job creation. The Swedish-Swiss conglomerate Asea Brown Boveri announced it would be cutting its west European workforce by 57,000, while creating other jobs in Asia. Electrolux followed with the announcement that it will cut its global workforce by 11 per cent, with most of the cuts in Europe and North America. Pilkington Glass also announced significant cuts.

    Martin Woollacott, columnist in the Guardian Weekly, sees European corporations getting squeezed in the global economy ... between their counterparts in the US, who have the advantage of a huge home market, and their Far Eastern competitors, subject to little shareholder pressure, who hold down prices to gain market share.

    Woollacott: "In the Anglo-Saxon world, the pressure to perform is relentless, and this pressure is growing in Europe, particularly in Germany. If companies, because of that pressure, among other factors, are now going fully into an Anglo-Saxon phase of restructuring, then much worse may lie ahead in the way of unemployment.

    " Germany has lost 1 million jobs in five years, and its companies are busy building plants in Eastern Europe, Asia and Latin America. If West European industry is massively relocating outside Western Europe, then arguments about the best governmental approach to unemployment would have to be seen as of limited relevance ..."

    Source The Guardian Weekly 22 June 1997 "Bosses must learn to behave again" by Martin Woollacott

    The OECD is predicting a 3% growth this year across its 29 member countries, the strongest level in nearly a decade. In its twice-yearly report released last week, the OECD predicts a slightly lower (2.7%) GDP figure for 1998. Unemployment across the 29 countries is expected to fall by 1m to 35.2m people by 1998, with the average jobless rate falling slightly to 7.1%. The OECD warns that Germany and other European countries run the risk of a "jobless recovery" due to high labour costs and intensive capital investment at the expense of labour.

    Source Reuters 13 June 1997 "OECD sees 3 percent 1997 Growth, Jobless Woes" by Brian Love.

    The Engineers Union reports that 28,000 workers, or more than 9% of the jobs in manufacturing in NZ, have been lost in the last year; and it predicts that thousands more will go this year. National Secretary Rex Jones says that we may well see whole industries disappear. The union has commissioned a special report on manufacturing by CTU economist Peter Harris. It says that manufacturing confidence is at its lowest for six years, profits are falling, and many companies are finding it increasingly hard to stay in business.

    Rex Jones says there needs to be urgent relief from exchange rate pressures on the export sector and a move to a comprehensive industry policy from government to help manufacturers compete overseas. He says the dollar is over-valued by about 15%, and is particularly concerned that the job loss effect of the rise in the dollar in the past year has still to show through. The Engineers Union prescription: new policies should include venture capital funds to help start new businesses, export credit insurance, help in export market development, a research and development strategy and a skills strategy.

    Manufacturing in NZ accounts for 18% of jobs, but contributes 21% to the total economy, and almost 60% of total exports.

    Source The Dominion 29 May 1997 "Manufacturing decline decried" by James Weir.

    In Australia, as manufacturing employment also continues to fall, the Howard government has decided to slow down its measures to lower manufacturing tariffs, and holding its automotive import tariff no lower than 15% till 2005. This move has brought applause from the local car manufacturers, but criticisms from farmers who say that their efficiencies were in effect paying for manufacturing protection.

    Source The Dominion 9 June 1997 "Australia slows down tariff cuts"

    Meanwhile, back in NZ, this week's Budget will not include provisions for launching Peter McCardle's new work-for-the-dole employment strategy. McCardle insists his reforms are on track, and says he never intended full implementation to take place before the second half of next year. McCardle: "I have said all along that I am not prepared to rush the policy development phase simply in order to score a few quick political points at the expense of a robust and effective employment strategy that makes a real difference for all NZ's unemployed ..."

    Meanwhile Labour's Steve Maharey is pointing to NZ First promises that the workfare scheme will be in the coalition government's first Budget. He is crowing that Peter McCardle and his plans are facing major hurdles and possible ruin: "However this is one broken promise that Labour welcomes ..." Maharey's prediction: when the workfare scheme eventually emerges, it will bear little resemblance to McCardle's plans as previously outlined, and will be scaled back to involve only the long-term unemployed.

    Source The Daily News 17 June 1997 "Minister happy with jobs strategy" by NZPA

    The Trade Union Federation has come out firmly against the McCardle work-for-the-dole proposals. TUF president Shane Te Pou describes the measures as `forced labour', and points out the workfare measures `fundamentally change' the basis of social security in NZ.

    Te Pou: "In NZ, social security benefits are earned on the basis of citizenship, not barter. To make beneficiaries work for their benefits ignores the simple fact that they have already contributed to the cost of their benefits, are paying both income tax and GST, and have a daily struggle to work to survive on the money they get as a benefit [...] Beneficiaries know that if a real job existed it would be fully funded, and they are not fooled by the rhetoric about skills development ..."

    Source New Zealand Herald 13 June 1997 "Workfare: It's just forced labour" by Shane Te Pou

    The Employers Federation has issued a report called Towards Full Employment in which it outlines what it thinks would achieve the target of limiting unemployment to what they describe as the `frictional' rate of 2-3% of the workforce. This frictional rate is defined as the number of people who are `between jobs', and employers making up their minds on who to employ. In the report, the Federation urges government to make the `hard decisions' on labour market reform in order to cut unemployment.

    The Federation points to minimum wage laws, the Employment Court, occupational regulation, lower than optimal immigration, business compliance costs, ACC and high welfare benefits as all contributing to a higher than necessary unemployment level. It urges tariff reductions and changes in education and training to help improve employment numbers.

    The paper also doubts whether the government's work-for-the-dole scheme will be effective, since meaningful work that could be done is already being done either through existing paid work or voluntarily.

    Federation president Simon Holdworth says that the road to full employment was essentially a political choice: "Is government prepared to take the hard and sometimes unpopular decisions which will allow the private sector to make the goal of full employment a reality?"

    Source New Zealand Herald 29 May 1997 "Employers' jobs-for-all bid hangs on wish list" by James Gardiner; and The Dominion 29 May 1997 "Remove blocks to labour reform urge employers" by Steve Evans.

    The employment agency Morgan and Banks has issued its new quarterly job index, which will measure the hiring intentions of NZ employers for the next three months. It is based on a survey of 850 employers.

    The June survey shows that one in six employers nationally plan to increase staff numbers, with one in four employers from the Upper North Island planning to increase staff. Growth in employment is expected to come from small to medium organisations, with large organisations (500+ employees) planning to shed staff.

    Areas of hot job growth: information technology, construction and property, services, and telecommunications. Job losses are expected in the chemical-oil, media, transport and manufacturing sectors.

    Source New Zealand Herald 11 June 1997 "Bullish employment prospects for quarter" by Tom Clarke

    The new NZ Qualifications Framework has been plagued by confusion and controversy since it was introduced in 1990. Now the government is signalling that it is going `back to basics' on its qualification system, in measures which will move away from the `hard ideological approach of the NZ Qualifications Authority and its framework of `unit standards' for everything.

    According to Education Minister Wyatt Creech, the `framework' was reaching a stage where it was being near universally rejected, with schools, polytechs and universities setting up alternative exam arrangements because they viewed the framework as too rigid. Future qualifications will probably see a combination of exams and unit standards to assess students, depending on the students, and the subjects being taught.

    Creech has just released a `green' consultation paper which recommends further changes to NZ's qualification system in a attempt to get a more `workable policy' in place. He says the future role of the NZQA will be as guardians of the quality of the country's qualifications, and of an increasing `internationalisation' of the NZ qualifications system. Submissions on the new qualifications proposals must be in by September 1st.

    The green paper is also available on the internet at

    Source New Zealand Herald 6 June 1997 "Qualifications set-up put in question" by Karen Burge.

    The Corrections Department is planning to send prisoners into the workforce, hiring them out at market rates, while paying the prisoners themselves only $5 a day. Corrections service development manager Mike Curran says that this is an extension of current practices where prisoners are already working packing nails, making shoes and trailers, woodwork and horticulture. He says the new policies would focus on training and rehabilitation rather than making money for the department. Employment Minister Peter McCardle says he is broadly supportive of the plan "if it could be put in place without creating problems". He wants to be sure the plan does not take jobs from the private sector.

    Dave Stewart from Lampen Personnel says that security and confidentiality would normally preclude prisoners working in corporates, and an influx of prison workers could drive wages down in existing semi-skilled, process-type or unskilled work.

    Source New Zealand Herald 31 May 1997 "Jails to extend jobs outside" by NZPA

    The Howard government in Australia has introduced tough new dole rules aimed at discouraging young people from abandoning education. The five unemployment and education benefits will be replaced next July by a single, parental means-tested Common Youth Allowance. The dole is completely scrapped for 16 and 17 year olds who will need to be in full-time education or training to qualify for the new allowances. Under this new scheme, about 46,000 young Australians will lose or receive lower welfare benefits.

    Unemployment in Australia is 8.8% of the workforce and youth unemployment is above 27%. In NZ, the official unemployment figure is 6.4% and youth unemployment 16.7%.

    The internet is proving to be a growing resource for job-hunters world-wide. Many leading newspapers, like the Washington Post, are making their employment classifieds available through their online services. There are also thousands of independent web sites that funnel resumes to employers and host online job fairs and recruiting seminars.

    The American Management Association (AMA) did a survey last year of 402 companies, and found that 53% posted job vacancies on the internet, and 51% use the internet for interactive recruiting, such as initial interviews. The internet ranked fourth behind newspaper advertising, trade publication listings and employee referrals in effectiveness for filling positions. It has outpaced traditional methods such as job fairs and employment agencies.

    Eric Greenburg, AMA's director of management studies in New York, says that the internet is becoming a standard means of communication. Online applicants save a lot of time and money by using the web, where there is detailed information about openings, rather than making long-distance phone calls or mailing bunches of resumes to get the same material. Greenburg: "It also says something about the applicant : it's an announcement saying you're in the 21st century..."

    Internet bookmarks : Take a look at these international websites devoted to job-hunting.

    The Riley Guide at

    CareerMosaic at

    The Main Quad at

    The Monster Board at

    Online Career Centre at .

    Source The Washington Post 15 June 1997 "For some, finding work means nothing but net" by Steven Ginsberg

    The internet is proving a key tool in the Ministry of Education's drive to solve NZ teacher shortages. The Ministry's website has proved very popular since it came online last October. The advantage for overseas teachers is that they now have exactly the same time-frame to apply for the jobs as NZ teachers. Previously, in the UK for example, the Education Gazette came a week late and teachers often only had a few days to apply for the jobs. In addition to advertising on the internet, the Ministry distributes an information pack to teachers overseas at present getting 150 requests a week.

    Ministry of Education web site is at

    The Education Gazette is online at

    At present there are about 1,100 overseas teachers working in NZ. They are usually from Commonwealth countries like Australia, Canada, South Africa and Britain. There is a surplus of trained teachers in Canada where the government is increasing the numbers of children per teacher, as a cost-cutting exercise.

    Source The Dominion 13 June 1997 "Internet helps solve teacher shortage" by Seth Robson"

    Move over CVs. The hot new tool in the job search stakes is the portfolio. More and more job seekers are being encouraged to develop portfolios of their work to indicate or prove their abilities to a prospective employer ... and it is giving some job seekers a distinct advantage. New employees today are expected to already have the skills and knowledge necessary to be productive. A portfolio is a collection of items which show the skills you have learned and the accomplishments you have achieved.

    Many graduates in the arts and journalism have long been expected to present a portfolio in a job interview. Now, other fields such as management, engineering and education are being encouraged to follow suit. A jobseeker is encouraged to gather a total collection of items, and then select a specific portfolio, often for a single use during a specific interview.

    US management consultant Pamela Schindler says that compiling a specific portfolio refreshes your memory about activities and can help in relating anecdotes during an interview. Schindler: "It also forces you to think about what accomplishments will be important to the interviewer, helping you organise them properly, knowing you will have a brief amount of time to reveal them during the job interview. A portfolio reduces the suspicion of falsification of accomplishments stated in your CV and in the interview, and demonstrates experience in critical knowledge areas, as well as communicating your enthusiasm, creativity, confidence, personality and work ethic..."

    Source more information of portfolios as a tool are available from the Job Choices Online website

  • TOES 97 in DENVER
    The TOES (The Other Economic Summit) Network is part of an international non-governmental forum for advocating economic ideas and practices upon which a more just and sustainable society can be built what they call "an economics as if people mattered." Every year since 1984, TOES has met at the same time as the official G7 world leaders summits to promote its alternative strategies. Those who support and work with TOES are convinced that promising and constructive economic alternatives are available and are being developed and implemented all over the globe. Reports of the yearly meetings are available on the internet (see diary) and TOES also publishes books, occasional newsletters, and maintains a network of TOES-related colleagues in various countries.

    The uniqueness of TOES is that it re-emerges each year as an expanding network of networks, re-linked and reinterpreted by volunteers from each host country and region. For further contact about TOES 98, contact the New Economics Foundation on the internet at

    Source: TOES 97 internet website

    Voice: "We cannot blind ourselves to the fact that too many young NZ'ers from every ethnic and social group, are drifting aimlessly and failing to reach their potential. NZ rates too highly in negative world youth statistics such as suicide, abortion, pregnancy, death through road crashes, alcohol consumption and unemployment.
    "These kids are our future so we should be educating them, investing in them, and guiding them to be the best they can be in life. Instead I see many suffering from depression and loss of hope for their future; a tragic number turning to suicide. [...]
    "All children need to be reassured that there will be a future for them beyond their present circumstances whatever that may be. We need to show them how to take charge of their lives by setting goals and accessing community resources which will help them achieve their aims [...] We cannot justify the cost to the country in dollars or lives. We must make a big investment now or be prepared to pay 100-fold in the future ..."
    -- Graeme Dingle, executive director of Project K, a youth development programme aimed at giving young people confidence and direction.

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