What bad timing

June 15th, 2013 at 1:00 pm by David Farrar

Fran O’Sullivan writes at NZ Herald:

David Shearer, Russel Norman and Winston Peters will have an opportunity to present themselves as the “government-in-waiting” when they turn up to HamiltonJet’s premises on Monday to release the results of their parliamentary inquiry into the future of .

What awful timing for them. On Friday the Performance of Manufacturing Index hit a ten year high, and on Monday the three parties will have to proclaim how manufacturing is in crisis and dying.

Mechanisms to deal with an “overvalued and volatile dollar” – which include making the dollar and jobs additional priorities for the Reserve Bank,

Again, what bad timing for them as the dollar has dropped by around 10% in the last few weeks.

Over a four-year period manufacturing jobs have fallen by nearly 40,000 (16.7 per cent); the number of manufacturing businesses has dropped by more than 1300 (6.1 per cent); the annual value of manufactured exports was down by 12.4 per cent; and manufacturing profits fell by 17.4 per cent.

Fran doesn’t say which four year period though. In the last four years the Household Labour Force Survey shows 255,600 manufacturing jobs in March 2009 and 246,200 jobs in March 2013 which is a decline of 9,400 – not 40,000.

Now any decline is not good, but 9,400 is one quarter the size of the 40,000 the Greens stick around.

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25 Responses to “What bad timing”

  1. SPC (5,563 comments) says:

    In relating the currency value to manufacturing exports, one has to identify how much of our manufacturing exports are in affected by the US dollar value – as compared to say the Oz dollar. The other factor is the relative value of the currency of competitors – Oz or American or European or Asian …

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  2. NK (1,223 comments) says:

    Now any decline is not good, but 9,400 is one quarter the size of the 40,000 the Greens stick around.

    Not just the Greens – but Eddie @ the Standard also: http://thestandard.org.nz/inconvenient-indeed/

    It just cracks me up how these three parties think they can solve a manufacturing *crisis* by passing a law. If only it were that easy!

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  3. Redbaiter (8,350 comments) says:

    David Shearer, Russell Norman, Winston Peters, John Key…..

    Sorry, just doesn’t matter to me.

    The country is rooted, and as long as we continue to think that relief will come by way of some bizarre unwarranted and almost religious faith in long term progressive politicians, its only going to get worse.

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  4. Manolo (13,518 comments) says:

    Business as usual for the scaremongering Left.
    Comrade Norman will boss around Captain Mumblefuck Shearer, junior partner of the unholy coalition.

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  5. dishy (241 comments) says:

    The truth makes little discernible difference to the slogan-infested politics of Shearer and Norman.

    And truth and Peters seem to be having a long break from each other.

    So the timing of the news in question is neither here nor there.

    I recently heard Stephen Toplis, the BNZ economist, talking about how rosy our manufacturing outlook was compared to that of all other OECD countries. So eat that, lefties.

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  6. Johnboy (15,903 comments) says:

    Look on the brightside Red.

    The asteroid should hit Terra and wipe out all intelligent life a couple of days after Shearer/Norman/Winston/Hone cobble together their coalition of the insane.

    Fortunately, by my definition of the event, you will be the only survivor! :)

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  7. labrator (1,837 comments) says:

    Now any decline is not good

    I contest that statement.

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  8. slightlyrighty (2,471 comments) says:

    Just the fact that these three will try to present themselves as a future government in waiting will be great for the National Party.

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  9. hmmokrightitis (1,585 comments) says:

    “David Shearer, Russell Norman, Winston Peters, John Key…..

    Sorry, just doesn’t matter to me.”

    I thought you were going to break out into song weddy, don’t get our prog hopes up like that with rhyming couplet and not deliver!

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  10. Reid (16,227 comments) says:

    I just hope that the Nats are all over the evening media tomorrow night and Tuesday morning when the bullshit fan is in full flight. With counter-point after counter-point in a proper and actual barrage of data-driven evidence-based counter-publicity that leaves the stupid lefties reeling with a WTF happened look on their stupid and disappointed little faces as their idiot propaganda strategy lies in complete and utter tattered rags despite the desperate but incompetent rear-guard assistance offered by the loyal but pathetically incompetent left-wing media as the heroic conservatives relentlessly tear the lefties of all stripes a new one across the board, as they all so richly deserve for this complete and utter taxpayer-funded waste of money that was always only ever going to have a predictable outcome, that of total pointlessness.

    See, normally the Nats act like, gee, big surprise, let’s pretend we’re possums whenever the lefties get something going and the media crank up their big book of lies on Campbell Live and SevenStupid and the rest of the idiot brigade like Barry Soper tag along behind. That’s normally what the Nats do. For some reason.

    But let’s hope this time, with months and months of notice, the Nats have actually had time to get prepared and engage an ASTUTE PR team who DON’T suggest the possum strategy.

    I’m really really hoping that doesn’t happen, this time.

    I’m not confident, but I’m hopeful.

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  11. LiberalismIsASin (288 comments) says:

    Since when did facts have any bearing on the tawdry little soap opera that is politics?

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  12. hj (6,855 comments) says:

    The country is headed in the right direction and on track. Thanks to Auckland’s population growth, pruning the RMA (and so called – “planners”) we will achieve agglomeration effects. Some of us will do well any ways. :) If it all turns to custard we’ll go and live with Bainemarana (banana).

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  13. peterwn (3,239 comments) says:

    Seems Hamilton Jet is looking to some nice juicy subsidies, research tax reductions, concessions, etc from a Labour/ Green government and presumably will be donating to their coffers accordingly.

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  14. mandk (954 comments) says:

    “… and manufacturing profits fell by 17.4 per cent.”

    but I thought profits are evil, if you are a red or a green

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  15. mandk (954 comments) says:

    DFP: “Fran doesn’t say which four year period though”

    That’s because she did a lazy cut and paste from the website for the Inquiry website.
    Sorry Fran, it’s a D minus for this one.

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  16. wreck1080 (3,858 comments) says:

    You are being a little disingenuous about the dollar.

    I would say a 10% decline in the NZD is rather miniscule given it had risen over 100% against some major currencies over the last few years.

    They are still right that it is extremely high on a historical basis.

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  17. mandk (954 comments) says:

    sorry, one too many websites there

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  18. Grizz (592 comments) says:

    The numbers are only part of the story. Industries change over time. There was a time when mining was big business. It was not that long ago when the IT industry was non-existent. We used to have more sheep, more shearers and more meatworkers than we do now. Now we have more people employed in the dairy industry.

    So manufacturing employs less people. At the same time other industries employ more. What is important is removing barriers and red tape to new industries and helping people retrain as jobs evolve with time.

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  19. greenjacket (454 comments) says:

    wreck1080 wrote the currency “is extremely high on a historical basis.”
    Bullshit. It is “high” because it is measured against the USD. Most NZ exports go to Aussie and China.

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  20. EmmaChisit (18 comments) says:

    Greenjacket – think you will find that sales to China are measured in USD rather than Yuan (which is somewhat pegged to the USD anyway).

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  21. Paul Marsden (991 comments) says:

    @Grizz (431)

    Agree, but I’ll go one step further and state that the term “manufacturing” is a somewhat generic term, and that there are many different states and/or, degrees of manufacturing. For example, my business is engaged in manufacturing products from raw materials, mined in NZ. I also make the machines that make these products, that people want. I am about as close to the true definition of “manufacturing” that you could get. Compare to say a company who imports widgets and assembles them here in NZ, and makes products that people want. For statistical purposes I guess this company would be classed as a “manufacturer”. And so you might also argue nowadays, that a company making (for example), a website, might also called a ” manufacturer”.

    You’ll get my drift… Blurred lines indeed.

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  22. johnbc (15 comments) says:

    Really DPF, this meme is not becoming of you. For a start, as far as I know, you run a service industry within NZ charging in NZ $. So for a start, you never experience the pain of juggling an income based on changing currency exchange rates. It’s a bit like an employee whose PAYE rate isn’t that relevant. They only care about the net wage. Secondly, you never have to calculate investment returns based on exchange rates. Personally, my income has halved since the halcyon days of the mid nineties (I’m a numpty that sells in US dollars and competes with a German company that is singing to the heavens since it competes in undervalued euros.) All good to the majority that can buy imported stuff with an overvalued currency. But really, it is increasingly a mugs game to manufacture and export most stuff from NZ. Compared say to the States for instance, nearly everything is more expensive to make here, and the exchange rate risk is ludicrous if you are selling in US dollars. As much as I hate to say it, the Greens and Labour are correct – manufacturing in NZ with the current exchange rates, even though they have just temporarily dropped 8%, is a total loser. If it were painless to relocate to say Tennessee, we would do it in a heartbeat.

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  23. hj (6,855 comments) says:

    Herman Daly:
    The economic tendency resulting from competition is to equalize wages and social standards across countries. But instead of cheap labor moving to where the capital is, and bidding wages down, capital moves to where the cheap labor is, and bids wages up-or would do so if only there were not a nearly unlimited supply of cheap labor, a Malthusian situation that still prevails in much of the world. Yet wages in the capital-sending country are bid down as much as if the newly employed laborers in the low-wage country had actually immigrated to the high-wage country. The determinant of wages in the low-wage country is not labor “productivity,” nor anything else on the demand side of the labor market. It is entirely on the supply side-an excess and rapidly growing supply of labor at near-subsistence wages. This demographic condition-a very numerous and still rapidly growing underclass in the third world-is one for which demographers have many explanations, beginning with Malthus.
    Globalization, considered by many to be the inevitable wave of the future, is frequently confused with internationalization, but is in fact something totally different. Internationalization refers to the increasing importance of international trade, international relations, treaties, alliances, etc. Inter-national, of course, means between or among nations. The basic unit remains the nation, even as relations among nations become increasingly necessary and important. Globalization refers to the global economic integration of many formerly national economies into one global economy, mainly by free trade and free capital mobility, but also by somewhat easier or uncontrolled migration. It is the effective erasure of national boundaries for economic purposes. What was international becomes interregional.”
    http://www.worldwatch.org/node/559

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  24. hj (6,855 comments) says:

    Herman Daly on Ricardo and Adam Smith

    “In the classical nineteenth-century vision of Ricardo and Adam Smith, the national community embraced both national labor and national capital. These classes cooperated (albeit with conflict) to produce national goods, which then competed in international markets against the goods of other nations produced by their own national capital/labor teams. This was internationalization, as defined above.
    However, in the globally integrated world of the twenty-first century, both capital and goods are free to move internationally-and capital, or at least money, can be shifted electronically with almost no effort at all. But free capital mobility totally undercuts Ricardo’s comparative advantage argument for free trade in goods, because that argument is explicitly and essentially premised on capital (and other factors) being immobile between nations. Under the new globalization regime, capital tends simply to flow to wherever costs are lowest-that is, to pursue absolute advantage.*”

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  25. wreck1080 (3,858 comments) says:

    greenjacket wrote “Bullshit. It is “high” because it is measured against the USD. Most NZ exports go to Aussie and China.”

    Firsly, why the nasty aggressive language? Are you suppressed in real life so let out frustruations when anonymous?

    Yet you have no facts, just random blurts and assumptions.

    Examine the Trade weighted index . The NZD has only been higher than the current level for 7 months of 19 years.

    Even worse if you remove 2013 from the stats, the kiwi has only been higher than now for maybe 1 month in the last 18 years.

    And this is ‘after’ the 10% drop.

    So, I call you out on this.

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