Employers see jobs boom falling off

Press, 3 December 1985, Page 8

Employers see jobs boom falling off

Bv

PATRICIA HERBERT

in Wellington

The employment boom associated with last yearns high business profitability is now falling off, according to the executive director of the Employers’ Federation, Mr Jim Rowe. He said job growth peaked in February this year with a 4 per cent annual rate; that by August this had dropped to 3 per cent, and that the trend was still downward. Problems he cited were a continuing shortage of skills which New Zealand’s educational, training, and industrial relations institutions , were not addressing adequeately; the rigidity of the labour market and its resistance to change; and this year’s wage round, now clocking in at “18 per cent

plus, over-all.”

“Such an increase can only push up prices significantly, reduce profits drastically, and put a substantial number of people’ out of work, directly or indirectly,” Mr Rowe said. Describing these as inevitable consequences, he said the level at which they would impact could not be predicted accurately but that they would bear some effect in 1986.

The degree would depend on the exchange rate, interest rates and the money supply among other things but, whatever happened, a continuing and accelerating slowdown in economic activity seemed inevitable. Indeed, within the last few weeks, redundancies had again become a significant feature of the industrial scene, he said.