NZ manufacturing needs a face lift

A New Zealand parliamentary inquiry into manufacturing yesterday heard the country and the government had stopped thinking manufacturing was an asset to the nation.

One Christchurch manufacturer said this imbalance needs to be checked, because there’s only so many lawyers and accountants a country can produce, reported.

"Now, you find teachers warning students that if you don’t perform they will end up in manufacturing," Talbot Technologies director Steve Wilson said.

Wilson added that Germany was the largest exporter of manufactured goods until 18 months ago, and it had a completely different attitude to its manufacturing industry.

"Their engineers have a title that is more revered than a doctor."

The lack of status for engineers and the manufacturing sector is something that needs to be addressed, Wilson explained that when the late Angus Tait, founder of Christchurch firm Tait Communications, was at a party he would be ignored while people chose to associate with the managing partners of large accounting firms.

"That’s what’s wrong with the culture, I believe," he said.

In 2008 NZ whitegoods manufacturer Fisher & Paykel Appliances off-shored the majority of its production, and Talbot, which was its second-largest manufacturer, lost a substantial portion of its business.

Wilson claims that Fisher & Paykel would not have moved its operations offshore had it felt more welcome at home.

"I personally don’t think Fisher & Paykel would have gone overseas if they felt the Government had an empathetic connection… It’s really about attitude, they felt they weren’t supported in New Zealand."

In the majority of cases moving production offshore and embracing a global supply chain means consumers benefit with cheaper prices, but Wilson argues these people don’t understand the importance of that business for the training and livelihoods of those thousands "along the chain", he said.

It was not just the company’s employees who were affected, but those employed by smaller businesses along the chain, like Talbot, he said.

To save the industry Wilson recommends a similar measure to the 40 per cent depreciation allowance for plastics manufacturers implemented in NZ in the wake of the 1980s economic reforms, be considered.
He said it would help boost the wider manufacturing sector.

The Parliamentary Inquiry is being held to discuss issues facing the manufacturing sector and is being chaired by New Zealand Manufacturers and Exporters Association executive member Cameron Moore.

The next hearing will be held in Auckland next week.

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