The crisis that isn’t

David Farrar unspins the spin over the so-called manufacturing crisis:

Labour, Greens and NZ First release their “report” from their manufactured inquiry into the manufacturing crisis. They specialise in putting out cherry picked data to try and convince people there is a crisis in manufacturing.

To counter that I’m blogging these graphs which are all directly from the Stats NZ Infoshare database and show some key metrics over time, so people can see the actual changes and trends. They are a mixture of positive and negative, but not an indicator of a crisis I would say. In fact all have been improving recently.



The Green/Labour bloc likes to only talk about 2008 until now. There is a reason for that…the graph shows the dip caused by the global financial crisis…and they are trying to conflate that event with government performance.

Despite the dip manufacturing contribution to GDP is still higher now than before Labour took office in 1999.

Farrar summarises his graphs:

So what do these graphs all show? Several things:

  1. NZ suffered from the global financial crisis in late 2008 through to 2010
  2. NZ manufacturing started declining prior to the GFC, in Labour’s last term. This is no surprise as we went into recession at the beginning of 2008, and the tradeables sector was in recession from 2005.
  3. Jobs in manufacturing have been declining for a longer period, due to automation
  4. Every manufacturing indicator is now positive and growing, with confidence for the sector at a nine year high

It’s good for parties to promote alternative economic policies for sectors such as manufacturing. That is what politics is about. It is not good however to try and manufacture a crisis, when there clearly is not a crisis.



THANK YOU for being a subscriber. Because of you Whaleoil is going from strength to strength. It is a little known fact that Whaleoil subscribers are better in bed, good looking and highly intelligent. Sometimes all at once! Please Click Here Now to subscribe to an ad-free Whaleoil.

  • Pete George

    I haven’t seen any details on the joint manufacturing report but someone has posted this:

    The Manufacturing Enquiry report is out, main recommendations are:
    1) a fairer and less volatile exchange rate through reforms to monetary policy;
    2) refocusing capital investment into the productive economy, rather than housing speculation;
    3) lowering structural costs in the economy, such as electricity prices.

    All that says is if we adopt the Green exchange rate control policies and the Green (and now Labour) CGT and the Green and Laboour price control policies that will “fix” manufacturing?

    If true that’s nothing more than repackaging existing policies. Is that going to be the Labour-Green-NZ First fix all package?

    Next we’ll be hearing those policies will also fix global warming and cancer. Cleanly and greenly of course.

    • Sir Cullen’s Sidekick

      I understand there is widespread support from Ganesh Nana, Hickey. Minty Minto, Sue Bradford and Matt Vomit McCarten for this report. They say the Government needs to wake up and read this report.

    • AnonWgtn

      Of course at they haven’t said that if they get the chance CGT will be on ALL property, as any owner is a capitalist, and should be penalised.
      Only renters will be exempt.

    • johnbronkhorst

      I gather they STILL haven’t read the Alan Reynolds report on CGT for the ASX?

      and fail to see that the USA are looking at more stimulus to bring the USD even lower and they are an economy approx. 100 times larger than ours. Meaning, any interference in the exchange rate will just be money wasted.

      It all appears to be a King Canute policy. Trying to stop the inevitable forces of world economy (the tide coming in), instead of dealing with the fact of the tide, profiting from it and riding the waves instead of bucking them and drowning.

  • blokeintakapuna

    Surely there must be a law(s) where Members of Parliament must attempt to tell the truth, the whole truth and nothing but the truth – all the time?

    Or is that just an implied “rule” measured as a basis of the politicians morals, ethics and honesty?

    In any other sector or industry – L&G would be charged with Fraud, Treason, or attempting to deceive their “clients” for personal gain. It’s certainly not ethical, so how is it legal from our wanna-be law makers?

    Besides the 3 yearly review – how else does Joe Public hold a politician to these usually expected traits and benchmarks – especially when the majority of MSM actually encourage and side with the deceit?

    • Sir Cullen’s Sidekick

      Bloke – As per Ganesh Nana, the manufacturing industry in this country is in crisis. Whom do you trust? An economic wizard like Nana or Statistic NZ which is owned and run by John Key?

    • Kingi

      “Surely there must be a law(s) where Members of Parliament must attempt to tell the truth, the whole truth and nothing but the truth – all the time?”
      yeah, I think you are correct. Trouble is, Banksie and Jonkey don’t really understand the concept…..

  • Sir Cullen’s Sidekick

    Sheep says Statistics NZ data cannot be trusted.

  • richard.b

    Breaking News:

    In a joint press release today, Labour and The Greens have announced they will merge to form a new Political Party.

    The new party, called Grebour, comes after it was discovered that a number of Labour policies were policies written by The Greens.

    Nicknamed The Greys, the new party will have 4 joint leaders, Russel Norman, Metiria Turei, David Shearer and Grant Robertson.

    A new joint policy document has been released outlining the 50 key points to win the next election. The document, ’50 Shades of The Greys’ includes the following:

    Free School Lunches for all Policy
    The Windmills in Schools program
    Reduction in Power prices for Electric Vehicles
    The Open Door Prison Policy or ‘Softer on Crime’
    The Vegie by ’20 Plan (to outlaw the eating of meat by 2020)
    The colour blue will be abolished
    Lentals will be the new curremcy from 2018

    • AnonWgtn

      New party acronym is “Graball”.

    • CheesyEarWax

      In bed by 9pm policy.

      Studies, to be commissioned by the new party, suggests that human uses less resources when they are sleeping.

  • Ronnie Chow

    From the Report ;

    “By unleashing smart, modern manufacturing, we can create real wealth, rather than trying to extract more and more from our over-taxed environment.”

    Unleashing ? Bring Foxconn here and pay higher wages ? Import robots ?

    These report writers are seriously grounded in la-la land .

    • johnbronkhorst

      one of their other tenets, is to control the exchange rate.
      Begs a couple of questions
      How does a country, smaller than most cities in the world, actually influence that?
      How will this meeting in the USA, designed to impact US exports and trade, one of whose aims is to FORCE the USD down (via more stimulous), impact on us and our ability to force our dollar down. Will this be a race to the bottom? Don’t think we would win, do you?

  • Time For Accountability

    The only crisis in manufacturing is the EPMU and its associates.

  • Tamaki

    With regards to the job losses the fact is if industry has not automated they are probably going or have gone out of business. Gone are the days when you need to have masses of staff to do menial jobs: Automation is everywhere.

  • johnbronkhorst

    I currently have sizable quotes out to several companies requiring:
    Automation..that will also require an increase in staff.
    Expansion into new manufacturing processes and of current ones.

  • Josh Metcalfe

    Is there any earlier data from the 70s and 80s on this that shows the effect of having a false economy like the Strawberry-Peppermint Twist are advocating?

  • johnbronkhorst

    Just saw shearer on TV1.

    “We have 120 submissions…”

    To their thingy with the losers.

    120 huh……and how many were from unions? You know those organisations that are affiliated to the labour party and pay them dues!!!!