A jobs summit being held in Auckland on Friday must put all the facts on the table so a reasoned debate can be held about future decisions, Otago Chamber of Commerce chief executive John Christie said yesterday.
Some "real issues" were emerging from recent employment statistics. With mass redundancies coming from the Alliance Group's Mataura plant, another 65 jobs going from the Tiwai Pt aluminium smelter and Solid Energy's job losses on the West Coast, employment and business confidence had taken a battering, he said.
Creating employment had become a hot topic.
Because of a prior commitment, Mr Christie will not be attending the Engineering, Printing and Manufacturing Union's "urgent summit" on Friday aimed at tackling the jobs crisis.
However, Mr Christie was interested in the results and believed the value of the dollar would be high among the topics of conversation.
New Zealand Manufacturers and Exporters Association chief executive John Walley said it was clear that New Zealand's exchange rate was the key problem behind the country's poor export performance, and the resulting job losses, seen over the past couple of months.
"Any denial of this problem is simply economic negligence."
But Mr Christie said "messing with the dollar" had wide consequences for other sectors.
There was no denying it was tough for exporters having the dollar consistently above US80c, but it was good for importers and gave New Zealanders access to cheaper goods. Fuel prices were kept lower through a high kiwi, inputs for industry were cheaper and the price of new cars had held steady because of the value of the dollar, he said.
BNZ senior economist Craig Ebert said it could be agreed the dollar was relatively high and it was hurting those not benefiting from high commodity prices and those who were competing with imports.
It was also true the high currency was conferring benefits on the economy, such as keeping inflation restrained, allowing interest rates to be lower than they otherwise would be, and making it cheap to invest in plant, equipment and machinery.
"Sure, there would probably be net benefits to the economy, overall, for having a currency not so high. But this is different to concluding the New Zealand dollar can somehow be lowered in a sustainable fashion by New Zealand policy-makers."
By trying to find ways and means to lower the dollar, there was a risk of creating expensive duds that would cause bigger problems in the future, he said.
The one "solution" being talked about to bring the dollar down was to cut interest rates.
"If it was as simple as this, we have to ask why the Australian dollar hasn't dropped over the last week, the last month, the last couple of years, while the Reserve Bank of Australia has cut its cash rate to 3.25% from 4.75%. Gee, could it be that things are far more complicated than many are capable of comprehending?" Mr Ebert said.
EPMU national secretary Bill Newson said the jobs crisis summit came in response to the string of high-profile redundancies in recent months and the emergence of a "trades drain" to Australia as record numbers of Kiwis crossed the Tasman looking for work.
"The summit is a sign of the emerging consensus that the Government needs to take a more active role in the economy. No-one who has seen the mass redundancies of recent months, or the numbers of Kiwis heading to Australia, can be unaware of the deepening jobs crisis in this country and the need for a new approach."
Every day, the effects of the mass redundancies of recent months could be seen on communities all over New Zealand, Mr Newson said.
At the same time, EPMU officials were talking to employers who said they did not want to lay people off and were looking for any support they could get to keep people in jobs.
The common thread through all the redundancies was the hands-off approach of the past 30 years that said the Government should keep out of the economy, level the exchange rate to be set by speculators and accept the decline in manufacturing in New Zealand as somehow inevitable, he said.
"There are alternatives and, as a country, we need to discuss them. This summit is about bringing together the new consensus and we welcome anyone interested in the future of our country to join us in planning a new way forward," Mr Newson said.
The union estimated that since 2008, nearly 40,000 manufacturing jobs had been lost to the economy
At a glance
The political panel: Green Party co-leader Russel Norman, Labour finance spokesman David Parker and NZ First leader Winston Peters.
The business panel: Peter Conway from CTU, Nick Inskip from the Heavy Engineering Research Association, technology entrepreneur Selwyn Pellet, NZMEA chief executive John Walley and Hugh Whitaker, of the University of Auckland.
Recent redundancies
Solid Energy's Spring Creek and Huntly East mines, Alliance Group's Mataura plant, Norske Skog's paper mill in Kawerau, the Tiwai Point aluminium smelter, Axiam Metals, Nuplex Industries, Glotech, Summit Wool Spinners, Goulds Fine Foods, Kiwirail and the Christchurch Engine Centre.
