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Unemployment kept high by government inaction on currency

Media Release: National Distribution Union
Thursday August 4, 2011

Unemployment kept high by government inaction on currency

The government’s refusal to implement plans to tackle the high NZ dollar is stopping unemployment from coming down as quickly as it could, a union for workers in the productive sector said today.

Unemployment remains high, at 6.5 per cent, in today’s Household Labour Force Survey.

National Distribution Union General Secretary Robert Reid said that the government could not rely on the Canterbury rebuild alone to boost employment.

Government needed to front up to the debate on monetary policy, otherwise industries such as wood processing would continue to lose jobs, he said.

“Although wood processors now have more favourable prices for processed logs over raw logs, the high dollar is a continuing headache.”

“Last month another North Island sawmill laid off 20 staff, saying the high dollar was ‘killing them’, and a major player in the industry continues to make redundancies in the Bay of Plenty.

“A high dollar is not a natural phenomenon over which we have no control, as it is often painted. The currency is affected by decisions made or not made by policy makers.”

"Governments do have options available to them. A Financial Transactions Tax or other measures would slow speculative cash washing in and out of New Zealand. These need to be investigated.”

“The Labour Party’s break with bipartisan consensus around monetary policy 18 months ago was a welcome move, although we will need to see clear policy direction from them before the election.”

“If John Key and Bill English care at all about workers in the productive sector, they need to come to the party with fresh ideas on monetary policy also.”

Robert Reid said that jobs policies should be a central focus of the November election.


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