No.162 15 March 2002 Essential Information on an Essential Issue

of key events over the last few weeks.













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6 February 2002

National MP Gerry Brownlee objects to a Department of Labour 0800 information line on paid parental leave that has been established while the legislation is still in select committee. Graeme Buchanan of the DOL's says paid parental leave is an issue people could become agitated about and that it was not unusual for the department to provide information to the public before a bill was passed into law.

7 February 2002

At 6.7%, unemployment in Hong Kong has reached its highest level in 20 years.

10 February 2002

G7 Finance Ministers and central bank chiefs meet in Canada saying they are optimistic about a quick global economic recovery. The meeting does not discuss the hazards posed by the Japanese banking industry.

Argentine banks and foreign exchange markets open for the first time in two months with the country's peso no longer pegged equal to the US dollar.

11 February 2002

The NZ Parliament resumes after its summer recess.

12 February 2002

The Prime Minister Helen Clark launches Growing an Innovative New Zealand, the government's economic growth framework.

Business New Zealand's Simon Carlaw says the government is acting positively but that there are few specifics in the policy or provided by the host of Ministers present at the "Innovators" launch.

Act Party's Rodney Hide calls the "Innovators" policy launch a "burger without meat".

Over 2,000 apprentices have taken up on-the-job training over the last year. Associate Minister of Education Steve Maharey says he is confident the government's target of 3,000 apprenticeships will be reached by the middle of this year.

13 February 2002

The number of print media job ads in NZ decreased by 2.3% last month. Job ads are 9.6% below this time last year.

The NZ economy has had its first positive December trade balance since 1996.

Women's Electoral Lobby spokesperson Barbara Mabbett tells a parliamentary committee that paid parental leave should only be available to the mother recovering from the trauma of birth and not transferable to the other parent. Mabbett believes that some men might think it a good idea to get on watching the rugby and let the mother go back to work.

More than a quarter of Australian employers say they expect to hire more staff during the next three months while just under one-in-ten say they will shed workers, according to the TMP Worldwide Job Index.

British Airways is expected to cut a further 6,000 jobs after already dropping 7,000 staff over the past year.

14 February 2002

The Mayors Taskforce for Jobs meets in Christchurch and launches its partnership with the NZ Business Council for Sustainable Development.

Australian unemployment rose to from 6.7% to 7.0% in January as the labour force participation rate rose to a record high of 64.2%. The Australian economy grew by a massive 100,000 jobs, the biggest rise in ten years. However the Australian Bureau of Statistics tempered the news saying the data was severely skewed by changing trends in seasonal work and the Bureau expects a reversal in the February statistics.

While female university graduates out number males by 57 to 43, a woman with the same qualification can expect to earn about $2,700/yr less than a man, according to the Vice-Chancellors Committee's graduates' destination report.

15 February 2002

The Mayors Taskforce for Jobs meets with heads of government departments at its Christchurch meeting.

New Plymouth's 40yr old clothing factory Classic Manufacturing is to close next month with the loss of 51 jobs.

19 February 2002

The University Students Association says that student debt has topped $5 billion.

20 February 2002

Gaming Machine Association spokesperson Garry Ward warns the government that communities, sports clubs and charities will feel any drop in revenue if the Responsible Gambling Bill restricts the flow of grants. Ward claims that gaming machines contribute over $150 million/yr to the community and supports more than 10,000 jobs.

22 February 2002

NInety NZ secondary school teachers have applied to work in Hong Kong where they can earn four or five times the amount they can earn here. Fifty-one NZ teachers already work in Hong Kong.

26 February 2002

The Tesna bid to buy Ansett Airlines fails ... spelling the end of the airline. The final 3,500 employees join the 13,000 workers who already lost their jobs.

28 February 2002

There were one-third more secondary teaching vacancies at the beginning of this school year than there were at the beginning of last school year according to the government's latest survey.

NZ business confidence is now higher than it was before September 11th. Confidence is improved in every sector except agriculture, where confidence was already at very high levels.

1 March 2002

Virgin Blue says that it will employ 1,000 ex-Ansett workers as it prepares to fill part of the void that will be left by the demise of the Australian domestic carrier.

3 March 2002

Last year the Information Technology Association provided 218 letters attesting to would-be migrants' computer skills. Combined with a job offer, an letter from the ITA helps fast-track working visa applications.

5 March 2002

Minister of Employment Steve Maharey says that about one-quarter of all 16-17 year olds are neither in school nor in full-time jobs. He warns that these young people are in danger of becoming long-term unemployed.

An international study on the impact of redundancy on executives finds disruption to family life, loss of income, and fear of long-term unemployment are the most difficult issues to deal with.

Japanese electronics company Nikon follows the lead of Sony and Minolta to manufacture their digital cameras in China rather than in Japan. Sanyo Electric and Olympus Optical are also beginning Chinese operations this month. Nikon is cutting its Japanese payroll by offering severance pay to workers who are 45 years and older.

6 March 2002

A new organisation intends to increase the number of Maori who attain a doctrate. The National Institute of Research Excellence for Maori Development and Advancement plans to increase the number of Maori with PhDs from the current 150 to 500 within five years.

The Centre of Economic and Business Research says that the negative employment growth in London during the last year will continue as thousands more jobs are still being cut from London businesses. Teachers, however, continue to be in great demand as there are consistent vacancies for 3,500 supply teachers in London.

8 March 2002

International Working Women's Day commemorates a strike by women in New York City 140 years ago over low pay, long working hours and inhumane working conditions. The NZ Council of Trade Unions' Darien Fenton says many areas considered to be "women's work" are still poorly paid and undervalued.

The next time the income threshold for the community services card is updated it will include people whose working income is equal to or less than superannuitants. At the moment, 48,000 working NZ'ers earning the same or less than superannuitants are ineligible for a community services card.

10 March 2002

The Australian bank workers union warns that up to 5,000 National Australia Bank staff may lose their jobs in a planned restructuring.

Kmart Corporation says it will close 284 of its stores in the US at the cost of about 22,000 jobs.

US President George W Bush signs an economic stimulus bill valued at US$51 billion in corporate tax cuts and extended unemployment benefits. February statistics indicate US employment grew for the first time in seven months and unemployment, now at 5.5%, was lower for the second month in a row.

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— Essential Information and Media Watch on Jobs, Employment, Unemployment, the Future of Work, and related Education and Economic issues.

Published every 2-3 weeks in New Zealand.

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Employment Catalyst

Mayors Taskforce for Jobs

maharey2.jpg - 5602 Bytes Steve Maharey

  • on Full Employment
  • on Youth in the Labour Force


  • The government is looking at raising the education and training leaving age to keep young people "active in increasing their skills" until age 18 or 19 years. Officials are currently working on the plan ... and the Labour Party hopes to include it in this year's election policies.

    Under the proposal, the highschool leaving age would remain at age 16, but further education and training opportunities would be provided to increase young peoples skills and ability to enter the workforce. These opportunities are likely to include more vocational training, such as apprenticeships, rather than training at polytechs or universities. There could also be more incentives such as income support, family support and cheap student fees, to keep young people studying until they turn 19 or find a job.

  • While many young people continue with formal tertiary education after they turn 16, large numbers are leaving school with few or no qualifications. The figures: According to Skill NZ, more than 25% of 16 and 17-year-olds have left school, but only 5% of 16-year-olds and 14% of 17-year-olds are in full-time employment. These unemployed young people don't become eligible for the dole until they turn 18.

    Minister of Tertiary Education, Steve Maharey, wants this to change: "We think we need to keep young people in the education system until they have their first qualification. If we don't do anything ... they're going to be at the dole office when they turn 18. We could get some of these young people at school and get them into a programme so that they can earn money while they are being educated."

    Source _ New Zealand Herald 8 March 2002 "Incentives to prolong schooling" by Libby Middlebrook; Maharey Notes Vol 3 Issue No. 63 11 March 2002 "Education and Leaving Age under consideration"


  • The Mayors Taskforce for Jobs has had its major annual meeting in Christchurch on 14-15 February. Twenty-two Mayors were present, including many first-term Mayors elected at last year's local body elections. The meeting also saw the formal launch of the partnership between the Taskforce and the NZ Business Council for Sustainability (see The Jobs Letter No.160).

    Meeting with the Taskforce, Employment Minister Steve Maharey challenged the Mayors to "stop being nice" and demand more from the government to solve unemployment. He also said he wanted less "back- scratching" and more action from Mayors.

    Maharey: "I want a more hard-nosed approach. I think we will all soon get over being nice to each other and get on and demand more things from each other [...] Our challenge is to ensure that over the medium term we continue to build on the progress we have made. Much has been achieved, but there is still much more to be done."

  • Recently, Maharey approved a strategy to advance the Ministry of Social Development's relationship with the Mayors Taskforce. This means that the largest government Ministry (which includes Work and Income) will now give greater backing to the Mayors objectives. The Minister has agreed that :

    — Both parties would work in partnership to advance the Taskforce's mission of "working towards the zero waste of New Zealanders"

    — The establishment of Community Coalitions led by Mayors and supported by Regional Employment Commissioners would generate "action plans"

    — A national strategic coalition would be established to ensure that a "whole of government" approach is taken to support local initiatives

  • Regional Employment Commissioners have subsequently written to their local Mayors inviting them to lead Community Coalitions, and progress has already been made in a number of areas. Example: Manukau City and its Mayor Sir Barry Curtis. The city has embarked on a co-operative venture involving Enterprising Manukau (the economic development arm of the Council), Work and Income, Skill New Zealand and Industry New Zealand.

    The project involves putting together a package of assistance for a US company called Jack Links Ltd. The company intends making beef jerky (dried salted beef) for export to the US market. The new venture will employ around 450 people over the next 12 months, of which approximately 300 jobs will be for unemployed Manukau people — most of whom are likely to be Maori and Pacific Island young people.

    Further to this, approval has been given for Enterprising Manukau to undertake some "value chain research" — looking at what employment opportunities might be generated in associated industries such as waste management, transportation, packaging etc. A Winz work broker is tied to the project and when opportunities are identified, they will attempt to match the opportunities with local unemployed people.

  • Mayors attending the 2-day Taskforce for Jobs meeting included Garry Moore (chairman, Mayor of Christchurch), Sukhi Turner (Dunedin), Jenny Brash (Porirua), Tim Shadbolt (Invercargill), Tony Arps (Hurunui), Alan McLay (Waitaki), David Owen (Waimate), Jim Gerrard (Waimakariri), Colin Hammond (Whakatane), Anne Candy (dep, Manukau), Bob Parker (Banks Peninsula), Owen O'Connor (Gore), Alison Wall (dep, Palmerston North), Wynne Raymond (Timaru), John Terris (Hutt), John Forbes (Opotiki), Jim Abernethy (Kaikoura), Les Probert (Wairoa), Peter Tennent (New Plymouth), Juno Hayes (Clutha), Malcolm Macpherson (Central Otago) and Michael McEvedy (Selwyn). Photos from this meeting can be viewed at www.jobsletter.org.nz/mtfjobs/ mtfjobs51.htm.

  • The Jobs Letter editor Vivian Hutchinson, who is also Community Adviser to the Taskforce for Jobs, gave a keynote speech to the meeting. A paper based on this speech ("A Capable Age") has been published by the Jobs Research Trust, and is available on the internet at www.jobsletter.org.nz/vivian/youth02.htm.

  • On the final afternoon of the Taskforce meeting, the Mayors met with a panel of CEOs and leaders of government departments to discuss future collaboration. This meeting included Geoff Bascand (General Manager, Labour Market Policy Group, Dept of Labour), Allison Dalziel (Ministry of Economic Development), Leith Comer (CEO Te Puni Kokiri), Peter Hughes (CEO Ministry of Social Development), Ray Smith (National Commissioner, Ministry of Social Development), Max Kerr (General Manager, Skill New Zealand), and Jay Sepie (Southern Regional Manager, Community Employment Group).

    Sources _ The Jobs Letter editor Vivian Hutchinson; Christchurch Press 15 February 2002 "More vocal line on jobs urged" by David King; Speech by Steve Maharey to Mayors Taskforce for Jobs 14 February 2002 "Growth, innovation and partnership between central and local government"


  • Winz offices are having a good year so far. The Ministry of social Development reports that the 4,795 job seekers moving into stable employment (in work for more than three months) last month was the highest figure achieved since stable employment outcomes were adopted as a performance measure in September 1995.

    Source _ Press Release NZ Government 1 March 2002 "Jan record Month for Job Seekers
  • The Reserve Bank has revised up its growth forecasts for the NZ economy, predicting 3.2% growth this year, followed by 3.9 per cent the following year. This would see the unemployment rate slide from about 5.3 per cent to 4.9 per cent by the end of next year ... and, if achieved, would mean about 70,000 more people will have a job in two years time.

  • World and New Zealand domestic economy figures have been much more robust than feared at the end of last year. Deutsche Bank economists believe that the global economy will improve further and faster than was expected. The bank's Chief Economist Ulf Schoefisch says that the main drivers of NZ domestic demand are strong inward migration, low interest rates and high farm incomes. These factors will weaken in the second half of the year but by then "the upswing in the world economy should give the export sector another push".

    Source — The Dominion 12 March 2002 "Thousands more jobs predicted" by James Weir

    • Where are the new jobs coming from? A breakdown of employment by industry group at December 2001 tells us that the strongest increase in jobs in the last year has come from health and community services (+30,100), followed by agriculture, forestry and fishing (+14,700), education (+10,000) and manufacturing (+9,000).

    Other sectors, however, have been off-setting these gains with continued job losses. These include business and financial services, (-6,500), wholesale and retailing (-2,900), and "other" services (-6,800).

    Sources — Statistics NZ December 2001 Household Labour Force Survey reports; Integrated Economic Services "Business Directions" March 2002


  • BERL economists say that the latest figures raise concerns about the health of the economy ... particularly when considering the extraordinary growth in jobs in the health sector. BERL senior economist Ganesh Nana describes the figures as "a little bit of a worry". He points out that if so much job growth is in the publicly funded health and education sectors, then this has implications for the long-term sustainable growth path for the economy. Nana says that if the government is gearing up to reach and sustain an economic growth rate of 4% a year ... "we would need to create a hell of a lot more jobs in things other than health and education".

  • Are the numbers unreliable? BERL is aware there has been a substantial increase in health funding, but it understands that much of this would be devoted to debt reduction rather than creating new jobs. If the official statistics of 30,100 new jobs are dubious ... then questions must also be raised about the total 42,300 new jobs shown in the survey, and their composition.

    Sources — The Independent 27 February 2002 "Health sector job growth raises sustainability issue" by Bob Edlin


  • The Minister of Youth Affairs Laila Harre last month released Youth Development Strategy Aotearoa, a guide for the government and other agencies to use in their approach to youth policy. The strategy aims to achieve a strengths-based youth development approach, to develop more skilled people to work with youth, to create more opportunities for young people to participate, and to build knowledge about youth through information and research. Harre stresses that the strategy does not involve establishing new initiatives but improving on existing ones.

    Opposition politicians have not been kind to the report. National's Simon Power called it "bureaucratic waffle which offered no real solutions". Act's Muriel Newman discredited it as "feel-good, no-good claptrap". Newman: "It defies belief that a process which took 18 months and involved consultation with 1,400 young people could come up with such an empty document."

    Source — The Dominion 12 February 2002 "Harre unveils strategy to develop young people"; New Zealand Herald 12 February 2002 "Govt strategy identifies key issues for youth" NZPA; The Dominion 13 February 2002 "Harre defends cost of youth strategy" Ross henderson; NZ government press release 11 February 2002 "Launch of the Youth Development Strategy Aotearoa"


  • The number of nurses leaving their jobs to either go overseas or just leave the profession is now twice what it was ten years ago, according to Statistics NZ figures. Jane O'Malley of the Nursing Council says that of all the new nursing graduates, 75% will still be working as nurses in 12 months time and that number will reduce to just 66% in three years time. O'Malley says that nurses do not believe their salary reflects the level of responsibility they have or their degree qualifications. She says that those going overseas are no longer leaving to get experience, as they had in the past, but are going because they feel they are not valued in NZ. O'Malley challenges the health system to lure back thousands of former nurses who are working in other jobs.

    Source —The Dominion 9 March 2002 "Exodus of nurses doubles in decade" NZPA


  • The Ministry of Economic Development is calling for submissions on what should happen with tariffs protecting our domestic textiles, clothing and footwear industries. As of 1999 there were over 20,000 NZ'ers employed in these industries that have the protection of 19% tariffs on competing imports. The freeze on tariff levels will be looked at again before 2005. Meanwhile, Minister of Trade Jim Sutton is negotiating a free-trade deal with Hong Kong, which is part of China: the biggest source of NZ imports of textiles, clothing and footwear.

    Apparel and Textile Federation's Kerry Harding says that a free-trade deal with Hong Kong would directly affect those NZ companies who manufacture for our domestic market. Harding says a Hong Kong agreement would not immediately affect the high-fashion export end of the NZ clothing industry but he warns that small-scale companies rely on the infrastructure (spare parts, suppliers and staff training) that the larger-scale domestic manufacturing provides. This means that a demise of clothing manufacturing for the domestic market in NZ is likely to be followed by the loss of our export fashion industry, as well.

    Source — New Zealand Herald 11 March 2002 "Tariff review puts 20,000 clothing jobs under a cloud" Simon Collins


  • People using foodbanks are living well below the "poverty line" according to the NZ Poverty Indicator Project published by the Christian Council of Social Services. The income for households around the country using foodbanks ranged from between just 28% and 44% of the median wage. It is generally acknowledged that households earning less than 60% of the median wage are living below the "poverty line".

    The study found that families with children, including sole parent households are highly represented in the poverty statistics. 79% of households that use foodbanks have children living in them and nearly half of those households are sole parent families.

    Poverty Indicator Project spokesperson Campbell Roberts says he wants more effective methods of addressing financial inequalities for those who stay home to look after children. Roberts: "Everyday our social services see the evidence that poverty still exists in New Zealand and witness the detrimental impact this has on our most vulnerable citizens. New Zealand needs to be an innovator in social policies that will enable all to participate."

    Source — New Zealand Herald 8 March 2002 "Poverty hits sole female parents"; The Dominion 9 March 2002 "Foodbank users among poorest"


  • Women take an average of ten years to pay off their student loans while men take just under four years according to research issued by the Aotearoa Tertiary Students Association. Women took longer because they tended to earn less than men, and took more time out of the workforce to have and look after children. For Maori women, repayment times are even longer.

    Association president Julie Pettett says women who have chosen to further their education are being punished through a system that financially disadvantages them. Minister of Tertiary Education Steve Maharey says that a discussion document on changes to the student loan scheme will be issued in May and that it would tackle gender issues. But Pettett says that with so little is known about the effects of the student loan scheme, the Association had commissioned its own study that would also be published in May.

    Source — 9 March 2002 "Women `slower to repay student debt'" Leah Haines


  • Young people who apply for the Independent Youth Benefit general have a raft of problems and a genuine need for the benefit according to Narelle Dawson, a clinical psychologist who has been studying the scheme.

    An Independent Youth Benefit may be awarded by Winz case managers to 16-17 yr olds who have either fallen out with or been rejected by their families but is sometimes critcised as being a financial path for teenagers to simply leave home. However, Dawson has found that one-third of all Independent Youth Benefit applicants have attempted suicide and she believes Winz has saved hundreds of teenagers by using their discretion to award the income support. While every teenager on the Independent Youth Benefit has an individual plan monitored by a Winz case manager, Dawson says that the benefit should be accompanied by more intense programmes to help teenagers through their problems which often include having no school qualifications, bullying, being victims of sexual abuse, or drugs and alcohol abuse.

    Source — New Zealand Herald 7 March 2002 "Youth benefit suicide shock" NZPA


  • An Australian Senate Committee has heard evidence that the Australian government last year spent over $250 million less than it budgeted on helping the unemployed. The underspending included $214 million on Job Network (about 20% less than budgeted), $14 million on regional assistance programs, $11.8 million on indigenous employment and $45.1 million on the employee entitlements assistance scheme.

    Evidence to a Senate estimates committee also shows that about half the people entering the Government's intensive assistance program for the long-term unemployed have already been in the system before ... raising questions about how effective the system is in getting people back to work.

    Government officials explained that the budget figures were an estimate of expenditure and the difference from the actual figures "does not necessarily translate into underperformance". The anomalies were said to be due to such things as depressed labour markets and programmes that were being established had lead times that were underestimated. A spokesperson for the Employment Services Minister, Mal Brough, told the media that the Australian Government had budgeted for 300,000 people to start employment assistance and the funds unspent in 2000-01 "simply reflected the Government achieving its ambitions at a lower cost".

    • The Australian Council of Social Service, however, says that the figures reinforce concerns that employment agencies in the Job Network are under-investing in "intensive assistance" clients and that outcomes are not as good as they could be.

    Laura Tingle reports in the Sydney Morning Herald that under the Job Network system, a proportion of clients with particular difficulties getting work are offered "intensive assistance" which may include training, provision of clothing or other resources to help them find work. The Job Network provider receives an upfront payment when the person starts the network's intensive assistance programme and a further payment if the person gets a job or enters a training scheme. There is no obligation on the provider, however, to spend any specific amount on the client. Evidence so far suggests considerable numbers of people do not get a job or training from this "intensive assistance".

    Source — Sydney Morning Herald 27 February 2002 "Unemployed miss out on $214m" by Laura Tingle

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