Remember the manufactured manufacturing crisis the opposition spent so much of their energy and our money on last year?
The news on it is bad for them but very good for the rest of us:
New Zealand’s manufacturing sector started 2014 on a healthy note, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI).
The seasonally adjusted PMI for January was 56.2 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). The sector has now been in expansion for 16 consecutive months, with the last six months also averaging 56.2.
BusinessNZ’s Executive Director for Manufacturing Catherine Beard said that despite the usual seasonal effects of Christmas and the holiday season, the sector has begun the way it finished off 2013.
“Positive comments from manufacturers revolved around a growing confidence by consumers, further gains in building construction and continued high levels of new orders, both domestically and offshore. In particular, the metal product sector is currently benefitting from the strong residential construction boom, which will no doubt continue for some months to come.”
BNZ Economist Doug Steel said it would be easy to understand if the PMI had lost a bit of heat in January, given the hefty lift in the NZD/AUD exchange rate. But the PMI has barrelled on, as domestic demand strengthens. . . .
This provided the opportunity in Question Time yesterday:
Hon STEVEN JOYCE: Of the 16 different industries measured by the household labour force survey, employment rose in 11, including manufacturing, which does debunk another myth often heard around this building. There is no doubting that the high New Zealand dollar is a challenge for exporters, but the January Performance of Manufacturing Index, which was released today, shows manufacturing has now been in expansion for 16 consecutive months, which is, weirdly, precisely the exact same time since the Opposition announced the start of its inquiry into a manufacturing crisis. I quote from the Performance of Manufacturing Index today, which says that manufacturing punched above its weight regarding job growth in 2013. It accounted for 13.5 percent of jobs added in the New Zealand economy overall last year, which is more jobs than were added in Australia in the same period. . .
There is a cloud on the horizon though:
Hon STEVEN JOYCE: . . . The Government has more than 350 initiatives under the Business Growth Agenda that are helping businesses grow, because that is how employment grows. I contrast this with policies that would put a chill on industries, that would cause their hiring intentions to freeze, and companies themselves might not even survive—for example, if you nationalise the electricity industry or double the cost of the emissions trading scheme on households and businesses, or if you impose new taxes on every single business in the country. . . .
The left demonise business without realising its the goose that lays the golden eggs of employment and economic growth.
The recovery is real but it’s not yet robust and a change of government with policies that would undermine business confidence could easily reverse the hard-won progress that’s being made.