Axe hovering over 100 jobs in timber
Up to 100 Gisborne jobs could go as JNL, a wood processing company, begins consulting on a proposal to nearly halve its workforce at its Gisborne mill, the firm says.
First Union president Robert Reid said businesses did not make such proposals unless they were serious about them.
‘‘Although this is a proposal for consultation at this stage we all know that companies don’t make such proposals unless they’re serious about them.’’
In a meeting on Tuesday JNL proposed shutting down its LVL (plywood) production in Gisborne with a loss of 97 jobs from its 205-strong workforce.
The mill at Matawhero employs around 200 fulltime staff. It mainly processes wood for the Japanese market.
JNL general manager Dave Hilliard said Japanese demand for plywood and other building products had fallen significantly in the past few years because of a declining housing market.
This has caused parts of the New Zealand processing business to operate at a loss, he said.
‘‘The Japanese housing market has been in decline and future demand for these products is not expected to improve because of the ageing population in Japan.’’
Hilliard said the company was also increasingly unable to compete against large-scale wood processing plants from China and South America.
The company had made efforts to increase sales locally and in Australia to reduce its dependence on Japan but ‘‘production capability and product mix doesn’t match the volume and price required by customers’’.
Around 100 fulltime positions would remain at the Gisborne site to sustain investment in higher-value residential and commercial products.
Hilliard said the proposed changes would have no impact on JNL’s forestry operations.
A final decision would be announced to staff on February 12.
Reid said a shutdown of LVL production would be ‘‘devastating’’.
‘‘Lots of families have multiple members who work at the mill. For others, although wages aren’t great, it’s the difference between being in poverty or not.’’
Reid blamed the previous National Government’s ‘‘neglectful, marketdriven, hands-off approach’’ for the flow of 3 million tonnes of ‘‘raw logs’’ a year leaving the Gisborne wharf to be processed elsewhere.
‘‘The downsizing of the JNL mill would see even more raw logs and therefore jobs shipped overseas every year.’’
He said the announcement is also a blow to the new Government’s forestry, regional development and employment strategy.
JNL was the only significant wood processor left in the city, and its downsizing constituted a ‘‘market failure’’.
‘‘The Government needs to intervene to address the market failure and promote a sustainable social and economic plan for the region’s forestry industry.
‘‘Before the election Labour promised to create more jobs in the region’s wood sector, announcing a $20 million proposal to establish a prefab mill in Gisborne. Fast-tracking this and other job creation proposals must be a priority,’’ Reid said.
Both NZ First and the Greens had similar policies.