More, and better, jobs a priority for business

By SIMON CARLAW

The New Zealand economy is dominated by very small businesses - 93 per cent of all workplaces employ 10 or fewer employees. Critical to New Zealand's ability to return to the top half of the OECD, a goal of both main political parties, and endorsed by Business NZ, is our ability to turn small businesses into bigger ones.

Creating more, and better, jobs summarises a major finding from Business NZ's recent survey of 258 businesses. The survey shows companies want to create more and better-paying jobs. They see high skill levels as important to maintaining competitiveness in export markets and at home where businesses face global competition.

Businesses are clearly concerned about low skill levels that make the difference between success and failure. Most respondents wanted much more emphasis in high school on enterprise, science and technology. There was littleconfidence in this being achieved given the current state of secondary education: "The curriculum is already overfull and some content needs cutting," said one respondent.

A large majority wanted more formal industry training, particularly in the workplace. A strong desire was also expressed for programmes to help those with the lowest levels of literacy and numeracy. Employers recognise that this task needs tackling at all levels and that excellent teachers are desperately needed. "Increase the pay for teachers to attract higher quality," was a common refrain. Businesses don't have a problem with the notion that such skills will command better pay for better performance.

Just as important is the ability for workplaces to be able to make new jobs so that opportunities can be seized. Global competition means, however, that the cost of new jobs has to be competitive. Current rules are seen as inhibiting the willingness of employers to invest in this growth.

Three quarters of the respondents wanted significant amendments to the Employment Relations Act, and many ideas were offered. Minimising procedure, discouraging unfounded personal grievances, allowing non-union members to have collective agreements and getting rid of multi-site agreements were common suggestions.

There also were calls for Employment Court reform; ; some for the court to be abolished, with cases instead heard in the District and High Court.

Dismissal and grievance rules were a concern, along with the potential costs of the soon-to-be-enacted Health and Safety in Employment Amendment Bill. Rules in the pipeline to restrict the ability to contract out work are a concern.

Businesses know that their staff are the critical asset that will determine their future success. Constraints on their ability to end an unsatisfactory arrangement with an employee who is not performing are considered to be particularly unhelpful. Staff dismissed during a trial employment period can bring charges of unjustified dismissal, bringing significant time and financial costs to many businesses - a situation that many companies seek to avoid by not creating new jobs as they might otherwise do. Most businesses favour a qualifying period before such claims would apply.

In the health and safety area, plans to increase fines, remove the right for employers to insure and make them liable for employee fatigue and stress were strongly criticised. These changes are seen as imposing costs that would hit competitiveness without necessarily contributing to the common goal of enhanced workplace safety.

"Privatise ACC then costs fall directly on those with a poor safety record," suggested one employer.Others worried about their ability to prevent accidents where employees ignored safety training or instructions.

Respondents were against proposed rules that would guarantee entitlements for employees when a business is sold or work is contracted out, returning comments such as: "This will affect the ability to reform a business to ensure survival or growth."

Individually, the costs of these kinds of workplace interventions are often claimed as reasonable against the identified objective. Cumulatively, it's a different story, and nor is there always the intended outcome from a particular intervention: one size rarely fits all workplaces.

Businesses want to play by the rules, but have concerns about some of the rules being instituted.

And businesses feel the country's growth prospects are not being fostered as urgently and directly as they should be. It's important to all New Zealanders, because without sustainable growth our health, education, environmental and social policy debate will increasingly be about how to ration what the country can afford.

The coming election agenda is, therefore, straightforward: Which are the policies that would deliver sustainable growth to ensure that our children and grandchildren enjoy a New Zealand as we would like it to be?

* In this series, Simon Carlaw cited results from a recent Business NZ survey that point to serious obstacles in the way of New Zealand's quest for balanced, sustainable growth. The Herald will publish the survey results on July 22, and the responses of all main political parties, who also completed the same survey.

* Simon Carlaw is chief executive of Business NZ

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