MEDIA RELEASE

1 August 2000 - Embargoed until 6am

TOURISM BUSINESSES SAY ERB WILL HIT EMPLOYMENT

A survey of Tourism Industry Association members shows that an overwhelming number of tourism related businesses are concerned at the impact of the Employment Relations Bill (ERB) on their businesses.

TIA Chief Executive Glenys Coughlan said that over 30% of members had responded to a survey and an overwhelming number indicated that they expected the ERB to be bad for business.

"When asked what their assessment of the likely impact of the ERB would be on their business - 33% said very negative, 50% said negative, and 15% said no change. Only 2% expected the ERB to impact positively on their business.

"We asked them their assessment of the impact of the ERB on employment levels in their business. Over half of respondents (55%) said they thought employment levels would decrease, or decrease significantly, with a further 40% saying there would be no change. Only 5% had plans to increase employment. This is worrying given tourism's current growth, and the growth in employment opportunities that have come with that. "Finally, we asked tourism businesses to assess the likely impact of the ERB on business profitability. 77% see the ERB as decreasing or significantly decreasing business profitability. Again, for a growth sector like tourism, this is disturbing. ?../more

"Our survey respondents covered all size of business - from those employing 1 - 5 full and part-timers, to those employing 50 and more. All are concerned about the impact of the legislation.

"With indications from Government that the ERB has not substantially changed, and having received such negative feedback from our members, we remain concerned that the ERB will have a dampening impact on the growth of the tourism sector over the next few years," Ms Coughlan said.

"The promises to change the Bill do not seem to have done anything to make the Bill more workable, less onerous or fairer on employers.

"TIA will continue to monitor the effect of the Employment Relations Bill on the tourism sector, and alert the Government to any aspects of the ERB which are genuinely affecting the ability of businesses in our sector to operate," Ms Coughlan said.

ENDS

Survey results attached.

More information: Simon King Manager, Government and Media Relations (04) 494 1845 (025) 807 252

What is your assessment of the likely impact of the Employment Relations Bill on your business?

Results (%)
Very Beneficial 1 0%
Beneficial 5 2%
No Change 42 15%
Negative 142 50%
Very Negative 93 33%
Total 283 100%
NB: Figures may not add to 100% due to rounding

A significant majority (83%) of TIA members reported that in their assessment the Employment Relations Bill would have either a negative (50%) or very negative (33%) impact on their business. Members employing fifty or more employees were the most pessimistic with 92% reporting an expected negative or very negative impact from the Employment Relations Bill on their business. 68% of members employing 1-5 employees reported an expected negative or very negative impact.

What is your assessment of the likely impact of the Employment Relations Bill on employment levels in your business?

Results (%) Increase Significantly 3 1% Increase 10 4% No Change 114 40% Decrease 128 45% Decrease Significantly 28 10% Total 283 100% NB: Figures may not add to 100% due to rounding

Over half (55%) of surveyed members expected employment levels to either decrease or decrease significantly under the Employment Relations Bill. A significant number (40%) reported that the Bill would neither increase or decrease employment levels in their business. Only 5% thought the Bill would increase employment levels. Members employing between 31-50 employees were the most pessimistic with 63% reporting a decrease or significant decrease to employment levels for their business, with 38% expecting no change. Half of members employing 1-5 employees reported that they expect no change to employment levels as a result of the Employment Relations Bill. 45% expect a decrease or significant decrease to employment levels for their business.

What is your assessment of the likely impact of the Employment Relations Bill on your businesses profitability?

Results (%)
Increase Significantly 3 1%
Increase 10 4%
No Change 114 40%
Decrease 128 45%
Decrease Significantly 28 10%
Total 283 100%
NB: Figures may not add to 100% due to rounding

The majority (77%) of respondents are generally expecting the Employment Relations Bill to either decrease or significantly decrease their businesses profitability. Only 4% expected an increase in profitability under the Employment Relations Bill. Members employing fifty or more employees were the most pessimistic with 88% reporting an expected decrease or significant decrease to their businesses profitability as a result of the Employment Relations Bill on their business. Only 5% expecting an increase. 61% of members employing 1-5 employees reported an expected decrease or significant decrease to their businesses profitability. Only 5% expect an increase.

How many employees do you have (full & part-time)?

1--5 76 27%
6--15 63 22%
16--30 54 19%
31--50 24 8%
50+ 66 23%
Total 283 100%
NB: Figures may not add to 100% due to rounding

Faxed to 751 full members of the Tourism Industry Association New Zealand. 38% of members returned the survey completed

The Tourism Industry Association represents 3,500 businesses and organisations within the tourism industry Members include airlines, airport companies, and regional tourism organisations, rental car, coach and taxi companies, inbound tour operators, travel agents, adventure tourism operators, accommodation providers, tourism attractions, researchers, training organisations and tourism services providers Tourism is New Zealand's largest export earner - accounting for 16 % of this country's export earnings The Tourism Industry Association organises the New Zealand Tourism Conference, TRENZ and the New Zealand Tourism Awards

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