Manufacturing Growth And Confidence Falls Sharply
MEDIA RELEASE 26 May 2000
MANUFACTURING GROWTH AND CONFIDENCE FALLS SHARPLY
Manufacturers are going into the second quarter of 2000 with a substantial drop in turnover. The figures from the Employers’ & Manufacturers’ Association (EMA) monthly survey of business conditions for April, saw both export and domestic turnover down 13% on the same month last year.
“This survey result is the most pessimistic that I can recall in a long time” said Alasdair Thompson, Chief Executive of the EMA.
“The EMA survey for April provides evidence of a significant slowdown in the pace of manufacturing activity. Higher interest rates and falling exchange rates are affecting consumer and business confidence. Only 38% of respondents are now operating at full capacity down from 53% last month. Our survey result confirms that the Canterbury Employers Chamber survey results out last week are applicable in the Auckland area too.
“Much of the business pessimism arises from the perception that the government is more interested in wealth redistribution than it is in sending positive signals to wealth creating business employers. Our members are telling us that business confidence could fall even further if the government fails to address our legitimate concerns regarding the Employment Relations Bill.
“Raw material cost pressures are at their highest levels (with 56% of respondents saying they would increase the price of their finished goods). Our enquiries indicate these price increases are imported and are exchange rate or oil related.
“While staff numbers are up 10% on the same time last year nearly 17% of respondents indicated they could decrease staff next month. That is up from nil percent in February and March, and is unlikely to take account of the adverse effect we can expect on employment from the Employment Relations Act when it comes into effect later this year,” concluded Alasdair Thompson.
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