29 Donaghys jobs go; 9 under review

Donaghys worker Chris Smith has accepted voluntary redundancy as 29 workers are set to lose their jobs at the South Dunedin factory. Photo by Stephen Jaquiery.
Donaghys worker Chris Smith has accepted voluntary redundancy as 29 workers are set to lose their jobs at the South Dunedin factory. Photo by Stephen Jaquiery.
The confirmed loss of 29 jobs at Donaghys' South Dunedin factory, and news of a further nine jobs to be reviewed next year, was confirmed yesterday to ''silent'' workers.

The loss of the jobs, which had been foreshadowed recently, came as another 29 manufacturing positions were lost yesterday at Tasman Insulation in Christchurch and 40 at Wellpack in Wellington, as a high dollar and cheap imports cut a swath through the industry.

Economic development Minister Steven Joyce said last night he sympathised with workers.

However, when asked what the Government needed to do about the high dollar, he said it was important to consider ''all the changes'' in the economy, including a 3.3% unemployment rate in Otago.

Workers at Donaghys heard the final numbers yesterday afternoon, but the workforce of about 70 will have to wait until Tuesday to discover who stays and who goes.

Two weeks ago, Donaghys announced it had begun a consultation process with staff and unions on restructuring that included a proposal cutting up to 30 jobs.

Managing director Jeremy Silva said then the company was struggling in the face of a consistently high New Zealand dollar and competition from Asia and Europe, the latter able to compete because of a weak euro.

That led Dunedin First Union organiser Ken Young to strongly question recent claims New Zealand had a ''rock star economy''.

Mr Young said yesterday while a further review had been discussed in general terms, to find nine more positions under threat was a surprise.

Asked about the announcement to workers, Mr Silva said: ''It was awful.''

That was partly because rope-making as a core product at the company had now ended and just a small amount of rope and braids was being produced.

''More important is the serious effect on people and their families.''

Workers listened to the news in silence.

While redundancy pay-outs would be ''fairly decent'', he said the loss of jobs would affect some more than others.

Manufacturing manager Mark Bowie said new production lines were opening at the factory for products from fertiliser to veterinary medicines, but those would require fewer workers.

Mr Bowie said he had been contacted by other businesses in the city interested in picking up workers.

''There is some interest out in the market.''

The 29 jobs would end in three stages in the next five months.

The nine to be reviewed by the end of June next year, would depend on the speed with which new manufacturing lines were commissioned, the success of the factory in the next four to six months, and movements in the exchange rate.

Charge hand Chris Smith accepted a voluntary redundancy from his job of more than 18 years.

Other workers had been ''pretty shocked'' at the numbers set to lose their jobs.

Mr Smith said his pay-out was good, and his wife still had an income, so his situation was not as bad as some.

''There's nothing you can do about it. It's the effect of the dollar.''

Tasman Insulation announced yesterday 29 jobs were to be cut at its Christchurch plant, which manufactures Pink Batts.

The company blamed, in part, an increase in the volume of imports, while the Engineering, Printing and Manufacturing Union (EPMU) blamed the high dollar and the lack of a government strategy for jobs growth.

It said the same issues were behind 40 redundancies at paper bag manufacturer Wellpack, in Upper Hutt. Mr Joyce said the high dollar had been challenging for some exporters.

''There's no doubt about that, but it's also been very good for consumers and very good for people who are importing capital equipment to expand their businesses.''

david.loughrey@odt.co.nz

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