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Job Creation—Number of New Jobs by 2013

Tuesday 4 October 2011 (advance copy) Hansard source (external site)

King3. Hon ANNETTE KING (Deputy Leader—Labour) Link to this
to the Minister of Finance

In light of the Minister for Social Development and Employment’s answer to Oral Question No 2 last Thursday when she said 170,000 new jobs was a “Treasury prediction”, what is the Government’s assessment of the number of new jobs which will be created by 2013?

EnglishHon BILL ENGLISH (Minister of Finance) Link to this

The projection that the Minister was referring to came from the Budget update, which is prepared by Treasury using its best professional judgment. The Government does not make independent forecasts. However, we think that the Treasury projections look feasible. They are currently finalised in its pre-election update, which will be released this month. I do not expect the projections will be greatly different from those in the Budget.

KingHon Annette King Link to this

What evidence has he seen to support the Treasury projection of 170,000 new jobs, when other Treasury projections have failed to materialise—such as the 4.7 percent growth promised in the 2010 Budget, which ended up as 2.3 percent growth?

EnglishHon BILL ENGLISH Link to this

Of course, it is hard to find evidence for things that are going to happen in 2 or 3 years’ time, but the evidence at the moment is that the economy is in a phase of moderate growth. There is reasonable business confidence, there is some increase in investment, and we have an export sector that has had probably its best year in 10 or 15 years. All of that is leading to a moderate but steady growth in employment.

KingHon Annette King Link to this

Why, if we are on track to create 170,000 new jobs, were almost 800 people made redundant from jobs in the Alliance meatworks, the Department of Conservation, Tangiwai mill, Canterbury Leather International, Housing New Zealand Corporation, the Warehouse, and the wood processing industry in the last month alone?

EnglishHon BILL ENGLISH Link to this

Well, that is part of the ongoing process of the necessary restructuring of the economy. Of course, losing a job is very difficult for any family that goes through that experience, and the best thing we can do for them is to build an economic environment where they have the hope and the probability of getting a new job. That is what we are focusing on.

KingHon Annette King Link to this

As he has already seen next month’s Pre-election Economic and Fiscal Update, will Treasury’s projections of 170,000 new jobs over the next 3 years be revised downwards; if not, why not?

EnglishHon BILL ENGLISH Link to this

The member will just have to wait for that. I have not seen all the detail of the forecasts, but the indications are—and as was set out in the Reserve Bank forecast just 2 or 3 weeks ago—that the economy is roughly on track from where it was with the Budget, subject to two qualifications: it has performed a bit better than expected in the short term—a bit more growth and a few more jobs—and looking out 2 or 3 years, because of the downturn in our trading partners, it looks a bit softer.

KingHon Annette King Link to this

Does he agree with the Prime Minister, who said most countries would trade their right arm for our position; if so, which countries have offered a limb in exchange for our almost 30 percent youth unemployment rate, which is one of the highest ratios of youth unemployment in the OECD?

EnglishHon BILL ENGLISH Link to this

In reference to offers to swap positions, I can tell the member that in discussions I had, I think last week, with the chair of the Board of Governors of the Federal Reserve System, Mr Ben Bernanke, at one stage he said: “Would you like to swap jobs?”.