Client: The Industry Training Federation

Authors: Dr Ganesh Nana, Kel Sanderson, Fiona Stokes and Michael Webster

Date: March 2009

This report provides the Industry Training Federation (ITF) with a projection of the labour demand required by New Zealand industry over the medium-to-long term.

The current economic outlook is negative and short-term prospects provide grim reading. Over the longer term we expect economic conditions to return to some degree of normality. Given that proviso, we project GDP to grow at 3.5 percent per annum between 2007 and 2016, and 3.1 percent per annum from 2016 to 2026. This growth will be driven by the investment and export components of economic activity.

This picture translates into overall net annual employment growth of 30,000 to 35,000 FTEs. This equates to average FTE employment growth of 1.5 percent per annum. This compares with an annual average growth rate of 29,500 (1.9 percent per annum) over the last 20 years, or annual average growth of 37,900 (2.3 percent per annum) over the last 10 years.

From an industry perspective, employment growth is projected to be weak in construction, agriculture, forestry and fishing, and communication services. In turn, export-related industries such as tourism, transport, wholesale trade and elements of manufacturing, are expected to experience moderate employment growth. Within the manufacturing sector, we project a contrast in employment growth between the relatively fast growing machinery and equipment sector and modest growth in the primary product processing (food and wood) industries.

BERL Ref#4753