More bad news for the manufacturing crisis

August 16th, 2013 at 11:00 am by David Farrar

Labour, Greens, NZ First and Mana recently concluded their inquiry into the “ crisis”. Sadly for them the sector is at near record confidence levels with the July PMI Index at the highest level since is started in 2002, for the month of July.

pmi

 

The BNZ states:

The BNZ-BusinessNZ seasonally adjusted PMI for July stood at 59.5, which was 4.3 points higher than June and a return to strong levels of expansion seen in May. Compared with previous July results, the 2013 value was the highest since the survey began in 2002, and the third highest monthly result on record.

And this part was fascinating:

The very robust level of the PMI overall goes to show the strength of the positives (domestic and possibly elsewhere offshore) outweighing the slowdown in Australia and associated NZD/AUD strength. This is not a complete surprise. After all, domestic manufacturing sales are about a quarter bigger than manufacturing export sales.

This is not to say some are hurting from the stronger NZD/AUD, but rather on balance economic positives are outweighing the negatives and increasingly so. Indeed, it is the economic positives in NZ’s favour that are behind the currency’s strength in the first place.

PMI’s illustrate the relative story. In comparison to NZ’s stunning 59.5 July PMI reading, the equivalent Australian series sits at a miserable 42.0. In fact, NZ continues to sit atop the PMI leaderboard of usual comparator countries.

This is what David, Russell, Winston and Hone call a crisis.

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33 Responses to “More bad news for the manufacturing crisis”

  1. wikiriwhis business (3,883 comments) says:

    93 jobs being lost at Huntly

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  2. infused (651 comments) says:

    so?

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  3. wikiriwhis business (3,883 comments) says:

    Trivialising

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  4. MikeG (425 comments) says:

    So where are all the jobs? Why isn’t unemployment falling?

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  5. Matthew Percival (19 comments) says:

    “93 jobs being lost at Huntly”

    So you back the existing mining of (possible) climate change inducing Coal? Would you like to see mining expanded?

    Regardless of those answers I’m not sure what the international price of coal has to do with the alleged Manufacturing Crisis

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  6. KiwiGreg (3,246 comments) says:

    93 union jobs lost at Huntly. Non-viable mining operation.

    For all the state ownership fan boys – Solid Energy had a value back in the coal boom, you couldn’t give it away today. Not risks the state is well equipped to deal with (particularly with the constant risk of capture by the unions to protect their jobs at the rest of our expense).

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  7. KiwiGreg (3,246 comments) says:

    @MikeG we already have one of the lowest unemployment rates in the OECD

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  8. DonB (1 comment) says:

    Confidence levels have certainly been very low in the past. The index seems to have hit rock bottom around November 2008.
    Why does that date ring a bell? …. oh that’s right – That is when the last Labour government then got turfed out of office! Immediately after the election there was a sharp rebound in the index and there has been a general improvement ever since. There was a crisis, but thanks to National, no longer.

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  9. burt (8,166 comments) says:

    Of course it’s a crisis – it’s improving under National after getting ugly under Labour. Remember these lefties don’t care about what is good for the country – they are socialists so only care for themselves and their potential to help themselves to other peoples money.

    They would rather see a crisis under National and win an election than see the country in good shape when they are in opposition. Self serving ….

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  10. wikiriwhis business (3,883 comments) says:

    “@MikeG we already have one of the lowest unemployment rates in the OECD”

    We have the highest tax rates in the OECD

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  11. wikiriwhis business (3,883 comments) says:

    Quote from Face Book

    J key letting cheap coal into the country and as a result our workers getting sacked…..blo.dy disgrace and I guess then you’ll sell mining operations and they can bring in cheaper workers and take all of the profits off shore…..

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  12. NK (1,194 comments) says:

    The 2014 election is over for Key & NAct because someone on Facebook doesn’t like him. It’s all over. Go now Key, while you still have some dignity.

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  13. NK (1,194 comments) says:

    After these results I have finally concluded that Labour/Greens and NZFirst are NFTG – Not Fit To Govern.

    We should use that Pneumonic for the next 18 months every time they shoot themselves in the foot, which is daily. Nay, hourly.

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  14. adze (2,046 comments) says:

    @wiki “We have the highest tax rates in the OECD”

    Source?

    Because the OECD’s own information seems to disagree:

    The average worker in New Zealand faced a tax burden on labour income (tax wedge) of 16.4% in 2012 compared with the OECD average of 35.6%. New Zealand was ranked 33 of the 34 OECD member countries in this respect (in decreasing order).
    Some examples of the results reflected in the Overview charts for New Zealand are:
    The tax burden for the single average worker decreased by 3 percentage points from 19.4% to 16.4% between 2000 and 2012. Between 2009 and 2012, there was a decrease of 1.7 percentage points.
    The corresponding figures for the OECD were a decrease of 1.1 percentage points from 36.7% to 35.6% between 2000 and 2012 and an increase of 0.6 percentage points between 2009 and 2012.
    The tax burden for the one-earner couple with 2 children at the AW level decreased by 13 percentage points from 13.6% to 0.6% between 2000 and 2012. Between 2009 and 2012, there was an increase of 0.9 percentage points.
    The corresponding figures for the OECD were a decrease of 1.6 percentage points from 27.7% to 26.1% between 2000 and 2012 and an increase of 1.1 percentage points between 2009 and 2012.

    http://www.oecd.org/ctp/tax-policy/taxingwages-newzealand.htm

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  15. Keeping Stock (10,245 comments) says:

    @ NK (12.04pm) – that’s gold. I shall start using NFTG to describe the LabourGreenNZFirstMana Party. It fits like a glove.

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  16. cha (3,914 comments) says:

    that Pneumonic

    cough…..big words are cool….

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  17. adze (2,046 comments) says:

    cha ;)

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  18. NK (1,194 comments) says:

    Yeah, but had to Google the spelling of it…..

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  19. double d (225 comments) says:

    i once had pneumonic … felt like shit and took weeks to get rid of it.

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  20. double d (225 comments) says:

    and that quote from facebook …. haaahaa. really was it worth posting that point – evil John Key has been orchestrating the importation of cheap coal from Indoonesia to make sure a SOE such as Solid Energy would fail…… give me strength. JK also has 5 heads and fangs!

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  21. Sir Cullen's Sidekick (866 comments) says:

    Everything is John Key’s problem.

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  22. Black with a Vengeance (1,750 comments) says:

    Manufacturing confidence at record levels as more jobs get replaced by machines. Savings in wages go to increasing bonuses to the executives.

    Meanwhile 500 applicants line up for a hump job at a Sth Auckland ‘The Warehouse’

    Bottoms up!!!

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  23. burt (8,166 comments) says:

    Black with a Vengence

    Yes, Key is so powerful isn’t he – he has created the industrial revolution and he invented computers and other machines to put people out of work – all that before he became PM and he is now responsible for the world changing.

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  24. burt (8,166 comments) says:

    Black with a Vengeance

    If you want the best example of exploiting workers – look to communism & socialism. The elite leaders don’t queue for bread do they !!!!!!

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  25. gravedodger (1,541 comments) says:

    Two thoughts:

    On the stats, BUGGER.

    On unemployment the first 5% of any guess, I mean calculation, should be subtracted as there are at least that many who will always be “unemployed”, for an example Christchurch today, 6% supposedly unemployed.
    Every employer trying to expand a workforce is shit out of luck and importing Chinese, Philpinos,Iindonesians and others is the evidence.

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  26. Black with a Vengeance (1,750 comments) says:

    It’s got nothing to do with Key or communism, burt you fucking idiot!

    It’s just how it is in manufacturing. People are gonna have to create jobs for themselves that a machine can’t out perform them on doing.

    Though i do remember Key promising to create 70 000 jobs over 5 years…how’s that coming along?

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  27. wat dabney (3,746 comments) says:

    Black,

    Savings in wages go to increasing bonuses to the executives.

    But they don’t though.

    In a free market profits are competed away to the minimum. It’s consumers who benefit.

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  28. rangitoto (231 comments) says:

    @ BWAV Pretty well looking at the chart on this page:

    http://www.tradingeconomics.com/new-zealand/employed-persons

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  29. thedavincimode (6,606 comments) says:

    70% increase since the 2008 election. I demand an inquiry.

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  30. MikeG (425 comments) says:

    @rangitoto – tell that to the UNemployed people.

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  31. mandk (935 comments) says:

    “J key letting cheap coal into the country and as a result our workers getting sacked…..blo.dy disgrace”

    by the same token, it’s also a blo.dy disgrace that all those foreign countries are letting our cheap exports in and taking their jobs.

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  32. Black with a Vengeance (1,750 comments) says:

    We do cheap exports ?…really, where and what?

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  33. Black with a Vengeance (1,750 comments) says:

    Profits to consumers who benefit?…yeah right!

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