Letter No.154
19 October, 2001

2 October 2001

There will be further redundancies at Television NZ following the recent axing of several senior positions. TVNZ says that further budget cuts are likely to result in more job losses.

3 October 2001

The Australian central bank drops its wholesale interest rate to 4.5%, the lowest since it began publishing its rates in 1990.

4 October 2001

The government confirms that it is raising its ownership of Air NZ to 83% by bailing out the insolvent national carrier with $885 million. Acting chairperson Jim Farmer declines to say whether there will be job losses but the airline is said to be considering reductions to both domestic and international flight schedules. Air NZ employs about 9,000 staff.

A drop in demand for plywood in Japan sees Juken Nissho lay-off 50 contract workers at its Masterton lumber and plywood manufacturing plant.

5 October 2001

The Swiss government puts $NZ693 million into Swissair to keep its national carrier flying. The entire Swissair fleet had been grounded this week after being unable to pay its fuel bill.

6 October 2001

While the average NZ'er has a net worth of $68,000, only half of all NZ'ers have a positive net worth. A WestpacTrust report found that one-third of all NZ'ers have zero financial worth (what assets they have are cancelled out by their debts) and a further 14% are technically insolvent (having more debt than assets).

7 October 2001

The Act Party considers adopting a policy to limit the amount of time a person can spend on a benefit. Spokesperson Muriel Newman says that benefit dependency has crippled families and that Act may support restricting the right to receive a benefit to two continuous years.

Minister of Finance Michael Cullen says the government may end up contributing a further $150 million to Air NZ, on top of the $885 million already committed.

The US labour market was deteriorating even before the attacks in New York. In September, the number of people on payrolls fell at the highest rate in ten years. Job losses that can be attributed to the economic effects of the September 11 attacks will not begin to appear in the statistics until next month.

The US Federal Reserve Bank cuts the official wholesale interest rate to 2.5%, the lowest level since 1962.

8 October 2001

Attacks against Afghanistan begin as the United States leads a military response to the September 11 attacks in America. Prime Minister Helen Clark says NZ'ers should assume that the US would accept the government's offer to provide SAS troops for the war effort.

National Party leader Jenny Shipley is told her caucus no longer supports her and resigns her leadership role.

Job ads have dropped by about 2% over each of the last two months according to the ANZ Job Ad Survey. Deutsche Bank economist Darren Gibbs says that the current rate of job ads are still relatively high and indicate a 2.4% growth in employment this year.

Official letters are sent to NZ Air Force staff specifying the staff cuts resulting from the scrapping of the air combat fleet. Most of the redundant Air Force workers are reportedly going to Australia where there is better demand for their specialist skills.

Australian job vacancies declined this last month but the figures have been skewed by the hard hit IT sector. Robert Olivier of Olivier Recruitment explains that apart from the IT sector, there was a 2.7% increase in advertised jobs. He says that, if you exclude the IT sector from the figures, there was an 8.8% employment increase in Australia over the last 12 months.

9 October 2001

The National Party parliamentary caucus elects Bill English as its new leader.

Air NZ chief executive Gary Toomey resigns after nine months in the job. Toomey apparently leaves behind a plan to cut 800 jobs but the NZ Herald warns that the airline may experience even greater job cuts if the global aviation slump worsens.

Recent Consumer Price Index figures indicate the annual inflation rate will be 2.4%.

Taiwan has seen its exports drop 42.5% over the last year. The Taiwanese economy, which is highly dependent on electronics sales to the US, is expected to contract by 2.5% this year.

The US president George W Bush promises the American people a $100 billion emergency stimulus package of spending and tax cuts in order to contain America's recession.

10 October 2001

Air NZ acting executive director Roger France says staff cuts and restructuring at the airline will be completed by Christmas. France says that "slimming" would start at the top and most job losses will be in middle management.

Both the NZ and Australian economies will be resilient in the face of a US recession, according to HSBC economist John Edwards. He says that the NZ and Australian economies will not be too greatly affected because they are not reliant on the hi-tech industries that are leading the international downturn.

British Airways asks 36,000 employees to accept bonus cuts, directors to accept 15% pay cuts and senior managers to accept 10% salary cuts in a bid to reduce costs due to the business drop-off since the September 11 attacks in the US.

11 October 2001

In the Quarterly Survey of Business Opinion, Darren Gibbs of Deutsche Bank says that while business confidence has dropped significantly, individual businesses report increases in their own activities and optimism about their own trading prospects. The report also says the number of businesses experiencing skills shortages, although still high, has declined.

Further downsizing at technology giant Motorola brings the total number of people dropped from the company payroll to 39,000 since the beginning of the year.

Irish national airlines Aer Lingus says it will cut staff by more than one-third. Chief executive Larry Stanley is making 2,500 staff redundant, saying that the current challenge is the airline's survival.

12 October 2001

National Party leader Bill English rearranges his front bench. Social Services and Employment spokesperson Bob Simcock slips from 9th to 12th in the pecking order but retains his portfolio.

NZ local body and district health board elections results are published.