Media Statement
23 September 2009

GDP figures add to mixed signals for workers

GDP figures out today alongside other economic indicators are leading some commentators to say the recession is almost over.

This is despite predictions that unemployment will peak above 7% in 2010 or even 2011.

Peter Conway, CTU Secretary said today that “there are mixed messages for workers at the moment. On the one hand they are hearing that the worst is over: on the other hand the labour market environment is harsh”.

“Although many employers have adopted a reasonable stance both in respect of maintaining jobs and negotiating on pay increases, there is a much more aggressive stance by some employers with increased lockouts and a refusal to consider even minimal pay adjustments.”

As dairy farmers celebrate an improved payout some dairy workers are facing a 6 week lockout to secure a basic collective agreement. Many top executives are receiving massive pay increases while some workers are being told that they should not expect a pay increase this year. However unions are settling collective agreements with many employers – including a wage rise.

GDP figures out today show a 0.1 percent lift in production GDP with the expenditure measure up by 0.4 percent. However the annual contraction in GDP is 1.8%, compared to +2.5% to June 08 and is described by Statistics NZ as “the largest annual contraction in economic activity since the series began in June 1987”. Statistics NZ also note that the 0.1 percent quarterly lift is “so close to zero, no significant conclusions can be drawn that this is a turning point”.

Peter Conway said that “the figures out today show there is a long way to go. However there is sufficient optimism in these figures that even the most hard-nosed employers need to reconsider their approach to worker issues at this time”.

The Government also needs to increase the scale of economic stimulus to head off the increasing level of unemployment.

ENDS