Dr Winchester, a lecturer in economics who has written about the effects of globalisation and free trade deals, said the loss of 430 jobs at Fisher and Paykel was a ‘‘body blow'' for the city and Mosgiel.
But he remained optimistic about Dunedin's long-term future.
He emphasised that he did not want to minimise the effects of the job losses, which would be harsh in the short-term for the affected staff and their families
Some of those who were adversely affected might move elsewhere for work, but low unemployment and the ‘‘tight' labour market meant that many people would find other jobs in the city, he said in an interview.
The availability of extra workers could generate opportunities for other Dunedin firms whose development may have been previously limited by lack of staff, he said.
Fisher and Paykel Appliances chief executive John Bongard said yesterday that free trade agreements with low cost labour countries such as China and Thailand had created ‘‘a playing field we are unable to compete in''.
Dr Winchester said that general prospects for the New Zealand manufacturing sector were not bright, but New Zealand was likely to gain significantly, over all, from its recent free trade agreement with China because of strong prospects for the country's agricultural exports in the huge Chinese market.
A recent big increase in cruise ship visits to Dunedin showed that globalisation brought positive opportunities, as well as some negative outcomes, he said.
Prof Geoff Kearsley, a senior Otago University academic and former chairman of Tourism Dunedin, has long taken an active interest in regional development issues.
Prof Kearsley said he was also optimistic about Dunedin's long-term future but it was disappointing that jobs in a smart leading-edge manufacturing firm were being lost.
The job losses would not mean the ‘‘death'' of Mosgiel but it would have a ‘‘very significant effect'' and could also have wider effects on business confidence in the city.
All of the redundant workers would be ‘‘very hard to absorb' in the city, with some likely to head for other work in Australia or elsewhere in New Zealand he said.
