Good growth but constraints rising

The latest BusinessNZ Planning Forecast shows GDP growth bouncing back from last year’s Covid emergency, with growth in in building and construction and agriculture.  But BusinessNZ's Kirk Hope says constraints are rising:  “The longer we face border restrictions and staff shortages, the greater the threat of a two-speed economy with some businesses and sectors flourishing while others lag.  Other challenges include supply constraints, infrastructure gaps, and business expectations of price rises, alongside a general increase in inflationary pressures.”

Energy and transport costs rising

Inflationary pressures are evident in energy and transport services used by NZ businesses - a BusinessNZ Network survey, during June, of 87 businesses facing cost increases during the last year shows:

* 40% faced increased electricity prices 

* 25% faced increased gas prices 

* Transport costs for exports increased 78%

* Transport costs for imports increased 124%

Strategies to cope with the increased costs:

* 74% said they would put their prices up 

* 22% said they would reduce staff numbers.

Business support - Covid

Businesses seeking clarity on Wellington’s level 2 restrictions should ensure anyone at the workplace who is unwell should self-isolate and get tested, BusinessNZ’s Kirk Hope says.  Employers should ensure their business has remote working capacity and can operate under no-contact rules.  Government support for Covid-related issues is on www.covid19.govt.nz, and the BusinessNZ Network Helpline numbers 0800 500 362 (North Island) and 0800 50 50 96 (South Island) are available for any businesses concerned about the risk or impact of Covid-19, Mr Hope says.

New system for overseas workers 

Applications to become an accredited employer for immigration are closing, in advance of a new system starting in November.  The Accredited Employer Work Visa system will be the new gateway for businesses seeking to bring in people from overseas on work visas.  The new simplified system will roll 6 existing visa classes into one and will allow registered employers to engage directly on immigration issues on behalf of their workers. BusinessNZ will run an information session when more details of thepolicy and criteria are available.

Gas still needed

The BusinessNZ Energy Council (BEC) says gas will still be needed as NZ shifts to a net carbon zero economy.  Responding to a Gas Industry Company consultation, BEC warns against removing gas from NZ’s energy system too quickly, as it’s needed for industrial and commercial use and for back-up electricity generation.  GIC says investment of up to $100m per year is needed to maintain production levels for these responsibilities and says any changes to existing commercial arrangements as a result of the net-zero shift could put that investment at risk.

Proposed changes to the Qualifications Framework don’t sufficiently recognise workforce skill needs, BusinessNZ says.  NZQA intends simplifying qualifications on the Framework in support of the Govt’s reform of vocational education, but BusinessNZ says this doesn’t address the fundamental problem of lack of responsiveness to industry needs by training providers; meanwhile the Govt’s curriculum review could further increase disconnectedness from business, as training providers focus on curriculum changes rather than essential business engagement.

BusinessNZ represents world employers

BusinessNZ employment specialist Paul Mackay has been elected to the governing body of the International Labour Organisation, to represent employers globally in international deliberations.  The ILO is the UN agency responsible for international labour standards, based on tripartite agreement between employer, worker and Govt representatives from 187 countries represented at the ILO.  In past work Mr Mackay has helped negotiate several ILO Conventions, was lead negotiator of the Domestic Work Convention, and has managed ILO labour law reform projects through the Pacific.

New Members

The BusinessNZ Network welcomes new Members: firms joining the Major Companies Group (a grouping of NZ’s largest and most significant businesses) include Heartland Bank and Habit Health Holdings; and industry bodies joining the Affiliated Industries Group include Aggregate Quarry Association New Zealand.  Welcome to the BusinessNZ Network!   Those wishing to join the Network can contact Phil Love plove@businessnz.org or Katharine McGhie kmcghie@businessnz.org.nz.