Auckland Drought: 14,000 jobs at risk if restrictions tighten on businesses

Monday, 22 June 2020

An estimated 14,000 or more jobs would be hit, many of them lost, if Auckland's drought leads to much tighter restrictions on water use by businesses.

Analysis by Auckland Council's chief economist David Norman suggested even a foreseeable scenario where water was still generally available, could see some businesses cut production by 20 per cent.

The city's water storage lakes are at seasonal record lows of 45 per cent after the driest-ever year-to-date, and a rising scale of mandatory restrictions has begun, with longer term forecasts for dry weather.

The city is under stage one restrictions, largely banning outdoor use, and Norman has focussed on stages three and four, which would involve production cuts in major businesses.

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Stage Three would end all irrigation and affect nurseries and garden centres, hitting around 500 workers, but the big numbers start when manufacturing cuts back.

'Food and beverage manufacturing employs 19,600 employees in Auckland. Glass, concrete and metal manufacturing businesses employ around 10,200 employees between them,' said Norman in his report.

He estimated production cuts of between 14 and 40 per cent would hit between 4,250 and 11,900 workers in some form, either with reduced hours or jobs being cut.

'I have not assumed a worst-case scenario - water is generally available, it is not an around-the-fire-hydrant scenario I'm sketching here, Norman told Stuff.

He thought around 1000 workers were already affected in some way by the Stage One restrictions not allowing water blasters, cleaners and car washes to use mains water.

Norman said while he is being conservative about how workers are affected, he thought the numbers he was using were probably on the low side.

'I haven't even tried to put figures on the hospitality sector - what happens to hotels or restaurants or cafes, if asked to make major reductions in water use,' he told Stuff.

Watercare has outlined key targets which the city needed to achieve on the pathway through winter from the current 45 per cent storage level.

An emergency additional take from the Waikato River from June 16 has added the equivalent of 2.5 per cent of the city's needs, and it was hoped the lakes might reach 50 per cent by the end of June.

The chief executive Raveen Jaduram said a good result would be 55 per cent by the end of July, and 70-75 per cent by November - when the lakes are normal around 90 per cent full.

If the early targets were missed, the city's daily consumption goal might need to be reduced from 410 million litres a day, to below 400 - which he said would be hard.

The latest three-month forecast by Metservice for Auckland had a strong and clear message that it could be unusually dry through from August to November.

'We are worrying about the coming summer, our biggest challenge will be if spring is dry leading into Daylight Saving, when people's habits start to change,' Jaduram told Stuff.

Auckland's mayor Phil Goff on Monday urged Parliament's Environment select committee to include as a fast-track project under Covid-19 recovery legislation, the granting of Auckland's 2013 application for resource consent to take an additional 200 million litres a day from the Waikato River.

That would more than double the current take of 161 million litres.

However, Jaduram said even if granted immediately, it would take about a year to build the additional treatment and pumping capacity at Tuakau.