Unemployment figure reporting masks real issues

23 Jul, 2009

An employment relations Professor says the daily reporting of employment statistics masks the real economic issue facing New Zealand.

Professor Erling Rasmussen, author of a new book ‘Employment Relations in New Zealand’ being launched today at AUT, says New Zealand’s low productivity goes back several decades and there are very real barriers to the country lifting its performance.

The AUT University Professor of Work and Employment says New Zealand is a small market trying to build a service and knowledge economy and this brings enormous and sustained challenges.

“Many service industry jobs, for example, are largely lowly paid, don’t establish long-term careers and are not known for good employment conditions,” he says. “And across many industries, employees experience relatively low pay levels.

“This means that in a strong global economy, consumerism floats into our labour market and our best and brightest head overseas. Meanwhile, we suck in a lot of extra people to keep the economy going.

“This low-wage route mentality doesn’t bode well for New Zealand’s overall productivity,” says Professor Rasmussen. “The end result, no matter whether we’re in an economic boom or bust, is an unstable economy.”

The flow-on effect for New Zealand becomes problematic in terms of career longevity, productivity and skills training, he says. Adding while offshore Kiwis maybe returning home currently, it doesn’t solve the country’s underlying issues.

‘Employment Relations in New Zealand’ is the extensively revised and updated edition of the 2002 text of the same name by Deeks and Rasmussen. It includes chapters on changes in occupational health and safety, vocational training and equal employment opportunities, and negotiation and conflict resolution.

Professor Rasmussen says that New Zealand’s disproportionately high number of SMEs adds to the country’s underlying productivity issue.

“Up-skilling staff through training and development is one of the few issues on which employers and unions agree but putting it into practice in an SME environment is not always realistic,” he says.

“SME employers operate from a necessarily survivalist approach. Their focus is on tax, revenue, getting products to market, intellectual property and so on. The bigger issues of productivity and skills shortages are in fact often counter-productive to employers achieving their immediate and short-term business objectives.

“So for New Zealand, a coherent, strong lift in the country’s productivity becomes problematic,” he says. “There’s no magic wand, but discussions on how we address the issues needs to be brought more into public debate.”

Professor Rasmussen says in the past 10 years the government tried to rapidly increase vocational training and generally improved the quality of education but it has not yet spilled into overall productivity.

He adds that while the New Zealand labour market is stuttering it is not experiencing the massive fallout of the UK, US and Ireland – or even New Zealand in the 1990s when unemployment figures fluctuated between 11 per cent and 6 per cent.

“The real concern is when people become unemployed for longer periods of time, they lose skills and confidence and restarting is difficult. This, alongside the productivity issue, is where the country’s leadership need to focus its energies.”

Notes for Editors:

Book launch: ‘Employment Relations in New Zealand’ by Erling Rasmussen PhD

When: Seminar 3-4pm; Book launch 4-4.30pm; refreshments to follow at 4.30pm, Tuesday, July 21, 2009

Where: AUT Business School building, Room WF711, Level 7, cnr Mayoral Drive & Wakefield Street, AUT University City Campus, Auckland City (refreshments WF801, level 8)

About the book

‘Employment Relations in New Zealand’ is the extensively revised and updated edition of the 2002 text of the same name by Deeks and Rasmussen. It provides a detailed examination of New Zealand’s current state of employment relations.

It includes discussion of recent developments, such as a new chapter on process and outcomes under the Employment Relations Act 2000 and changes in occupational health and safety, vocational training and equal employment opportunities. There is also a new chapter on negotiation and conflict resolution.

The text is supported by a dedicated website: www.employment.org.nz, which includes detailed employment relations case studies.

Publisher: Pearson Education New Zealand, Auckland, NZ, 2009: www.pearsoned.co.nz.

About the author

Dr Erling Rasmussen is Professor of Work and Employment, and Discipline Chair of the Department of Management at the AUT Business School, AUT University. He is co-editor of the ‘New Zealand Journal of Employment Relations’, a past president of the Association of Industrial Relations Academics in Australia and New Zealand (AIRAANZ) and has undertaken research for governments, businesses and unions.

For more information about Professor of Work and Employment and AUT Business School Chair of Management, Professor Erling Rasmussen, please go to: http://tinyurl.com/luvpbb

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