Housing, employment linked—economist

Press, 23 July 1986, Page 9

Housing, employment linked—economist

PA Wellington Rental housing is crucial to keeping unemployment down while the economy is being restructured, according to the ANZ Bank’s London-based chief economist, Mr David Ashby. Mr Ashby, in New Zealand recently, said the lack of rental accommodation and the unwillingness of people to move to other regions for jobs had left areas of Britain with high unemployment. Areas in the north-east of Britain had unemployment rates of round 25 per cent, while southern regions had labour shortages. Part of the reason for this disparity was the

unwillingness of people to shift away from their families and the lack of rental accommodation. About 60 per cent of Britons owned their own home, compared with about 30 per cent after World War 11, he said. However, the same problem had not arisen in the United States, where people had always been more prepared to move to other regions for jobs, and where a smaller proportion of people owned their own homes. Mr Ashby also believed that privatisation of State enterprises would prove beneficial to New Zealand. Referring to experience in Britain, he said the sale of State enterprises had realised three benefits: © It had raised revenue the Government would otherwise have had to raise through the Govern-

ment bond market. © It had reduced the influence of the State sector in the economy; a philosophical gain for Mrs Thatcher’s Government. ® And it had made the enterprise more efficient. Mr Ashby noted New Zealand was going through the same process and said that, although there was an element of fear, particularly among workers who saw they no longer had a guarantee of job security till retirement, there were benefits in privatisation. The enterprise had to look more closely at its activities and ask whether they were profitable. At the same time, workers had gained a greater sense of responsibility through the personal shareholdings they had been able to take up In the enterprises.