Kirk Hope, chief executive of Business New Zealand. Photo / File
With the 28-day lockdown at the half-way mark, there are tentative signs that the strategy is working and New Zealand's economy may be able to start to come back to life in a little over a fortnight's time.
The BusinessDesk team is fanning out around the country's business leaders to ask what they need to know, what they plan to do, and what their biggest challenges will be when the country starts moving from lockdown to freedom.
Kirk Hope, chief executive, Business New Zealand
"This week, we're focusing on getting more clarity on what are the criteria for transitioning between the alert levels and what does that mean for businesses?"
The national voice for New Zealand businesses says its members understand and broadly support the public health objectives of the lockdown, but there will be myriad practical questions about what can and can't be done as both the community and businesses move from one level to another.
Among the likely issues is the potential for different parts of the country to open up at different rates, and for some industries to be fast-tracked back to production either because of their institutional capacity to apply physical distancing and other safety protocols or because they can demonstrate that, at a lower alert level, they should be allowed to operate.
"Will certain businesses be able to operate between levels 3 and 4?" says Hope. "The sooner we get clarity around that, the better. There's a big difference between four weeks without cashflow and six weeks and even bigger difference between one month and two months."
For tourism and tourism-related retail businesses, the cashflow drought began three months ago, when coronavirus cases offshore started to impact on international tourist arrivals, so they are all the more anxious to start trading again, even knowing tourism numbers will be far lower.
Hope is looking to the Infrastructure Commission for a strategic approach to investment that will help retool the New Zealand economy and looking to the education sector for "rapid reskilling" rather than traditional training approaches.
While unemployment numbers are expected to explode because of the Covid-19 lockdown, the country was experiencing full employment prior to that. Hope believes that when migrant workforces and seasonal holiday-makers on working visas are no longer available, there will be work available for many New Zealanders who need it, and that many young people will head back into education and training, as often happens during economic downturns.
"I think we'll find there's significant flex in the workforce that means we can can ensure we may not have as significant a level of domestic unemployment as we might otherwise have."
Raf Manji, strategist and chair of the Christchurch City Council strategy and finance committee during the Canterbury rebuild
Shutting down an economy seems to be quite simple: turn off the lights and go home. Re-starting an economy is a slow process, as everything needs to be turned back on, checked, re-supplied and re-fuelled. Running down supplies is one thing. Getting new ones is another.
Two things are key for the re-start: not rushing and having plenty of financial liquidity to oil the wheels. Start with the easy jobs: building and construction is one. Activities where workers can be in small groups or pods, be cleared to work together and get the basics under way: infrastructure, housing, and ongoing maintenance.
Outdoors work, such as waterways, parks, gardens, the huge backlog of projects that our conservation estates need to be done. The Provincial Growth Fund should have a long list of projects, and local government capital programmes can be brought forward once funding is available.
Now the Reserve Bank has crossed the monetary Rubicon into the land of quantitative easing, it should be clear to everyone that money is simply not a problem.
As long as inflation is within target and we have spare capacity in the economy - we will have plenty of that with our international tourism and education sector vaporising - there should be no issue with funding, and the Reserve Bank can supply as much as is needed.
At the moment it is supplying that through the banking system but soon it will realise it can also fund the public investment programme directly and for no cost. It should do so.
This reboot will be successful if it is done methodically and with a clear plan for opening up further sectors, as the risk of Covid-19 spread recedes. We will need a hard border for this, even internally if required.
Large gatherings of people will still be a risk, so malls will be out, but online shopping will be in. We may even see a domestic sports programme, with our top rugby, netball and soccer teams able to be cleared to play each other. Empty stadiums maybe, but many viewers will be keen, and a thirsty global market awaits.
There will need to be strong government support for some time. Certain sectors, such as energy and transport could be in for a serious realignment, to a more sustainable structure, with self-sufficiency in mind.
Domestic manufacturing may be more in vogue and the risk in global supply chains becomes clearer. Examples of publicly supported, post-war economic reconstruction in the world's leading economies should be of note. Japan, Germany and South Korea were all supported by the firm hand of the government in their re-development. With the invisible hand of the private sector alongside, the future could be brighter than we think.
Simon Bennett, chief executive, AWF Madison
"We just want to see some detail, they can't tell us when, but I saw the Prime Minister's saying 'ready yourself'...but there's not a lot of details so we are assuming."
Bennett, who heads New Zealand's largest recruitment company, says work such as roading projects will come back on stream after the lockdown ends, but workers need details on what is a safe practice and what isn't.
"A lot of it is site-specific. But for example, for a roading operation, where you need five people to get in a van, is that still okay when the airlines won't have anyone in their middle seats?"
The recruitment boss says its blue-collar unit, formerly known as Allied Work Force and which can place up to 3,500 workers per day, was the worst hit by the lockdown.
"We have been hit on the blue-collar side, as there's no essential services work for them except logistics and supermarkets really, so we have big parts of the workforce stood down."
For white collar jobs in its Madison and Absolute IT brands, recruiters are more likely to wait out the lockdown before placing workers in office settings.
To stay informed with the developing rules, Bennett says, "we keep close to Business NZ, who really just feed stuff back and forth from MBIE, the keeper of all these decisions."
Jon Tanner, chief executive, Wood Processors Association
Along with other non-food manufacturers, the wood processing industry wants to restart production as soon as possible or face "irreversible market loss."
In an ideal world, that would mean being allowed to start work while the country is still at level 4, but at the very least, there needs to be a system that tells manufacturers what their obligations are at levels 3 and 2.
And no one knows the answer to that, says Tanner.
He understands that the Ministry of Business, Innovation and Employment is processing some 20,000 applications from non-essential businesses that want to be allowed to operate, but that there is no published framework to guide those applications or to know how officials are making their decisions.
Tanner says there needs to be a system as clear as the one the Ministry for Primary Industries is operating to certify food and beverage manufacturers.
"The sooner we have that, the sooner we can plan for opening up", even if that can't happen until the lockdown is lifted, hopefully at the four-week mark on April 22.
"We at least need a framework in place for level 3. There's a lot of confusion about what it means to be an approved and safe producer."
Meanwhile, he's fielding calls from international companies wanting wood products that those countries have deemed essential, but which New Zealand firms are prevented from supplying.
"The viability of these exporters is rapidly diminishing with every day, every hour that their operations are shut down and they can't deliver to essential supply chains. Their customers will very soon be forced to find alternative suppliers with major implications for their operations and ultimately New Zealand's economic recovery."
Vodafone NZ Business Director, Lindsay Zwart
Almost no one is using Vodafone's roaming services at the moment, but mobile network useage is 60 per cent higher than pre-Covid.
That means the telco is focused on upgrading and reinforcing infrastructure to ensure network stability.
As the country comes out of lockdown, Zwart says it will be important to learn from the impact of the crisis on the country's logistics networks and to be receptive to ditching traditional supply chains.
"We talk a lot about what 5G can bring. One area is in the 'collaborative robot' or cobot space, which starts to remove the risk of people-driven logistics, for example at ports."
The concept of "ubiquitous computing" has come of age, she says, citing the fact that after Vodafone's Indian call centres were closed down on March 24, the company went from 95 per cent voice to 90 per cent online chat overnight.
"We had to determine pretty rapidly what we were going to do to support New Zealand as a country, so what we did was to convert all of our customers onto chat and we found that customers were more tolerant in chat than voice."
Staff had to be redeployed and the Indian teams had to be set up to work from home.
"Over the past four years all our technology told us we couldn't possibly have our contact centre staff work from home due to security concerns. But in a couple of days we changed the way we approached the contact centre and we now have all of our team working.
"It's a new way of thinking in a way that we never thought was possible but sometimes you are put in a position where changes have to be made."
In future, closer collaboration with government agencies and further investment in connections to remote areas will become more important.
Geoff Ross, executive chairman, Moa Brewing Co.
Moa Group is best known for brewing beer, but two-thirds of its revenue comes from hospitality, including operating top Auckland restaurants Ostro and the Auckland Fish Market, both of which have closed for the duration of the lockdown.
Ross thinks "the brakes will come off take-home food" when the country exits level 4, so its outlets are preparing menus and staff for that.
While he hopes there will be more time to prepare as the alert levels change, "the parameters of level 4 are very clear but level 3, there are so many vagaries at the moment, I'm not sure to be honest."
"In California they've given exemptions to taking bottled wine home from restaurants," Ross says, suggesting the relaxation of liquor licensing rules to help hospitality, along with diners being allowed to eat out, even if they still have to maintain their 'bubbles'.
The former adman best known for the success of 42 Below vodka is concerned about what will happen to entrepreneurship as the economy recovers.
"Typically what happens when you come out of a major event like this is that people become more conservative in their behaviour, so entrepreneurship slows and new capital, and start-ups slow. People will retreat into their day jobs and likewise investors will flock to utilities."
"If there is a mechanism to make early stage investment attractive - if Kiwisaver funds had to give a small proportion of investment to early stage and expansion stage companies - that would be a really useful bit of stimulus," he says.
• Covid19.govt.nz: The Government's official Covid-19 advisory website
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