The latest lockdown has highlighted issues New Zealand faces by not keeping pace with what is happening elsewhere around the world, says EMA chief executive Brett O'Riley.
"Many of our exporters have found little sympathy from their overseas customers when they explained, with New Zealand in lockdown, orders would be delayed or weren't able to be met.
"The response from their customers was along the lines of 'not our problem' or 'your competitors do not have a problem supplying us'."
Covid-19 continues to impact businesses throughout New Zealand with the way "we work the contingencies, the challenges arising from border restrictions, managed isolation and quarantine (MIQ) constraints, and consequently our ability to re-engage with the rest of the world".
O'Riley says Covid pervades everything — the economy and business' ability to get the people, materials and technology through to the very fabric of communities.
"Overall we have fared better than anyone expected over the last year. But I am feeling less optimistic now for our business landscape and our economy. Although the global economy keeps trucking along, other countries are arguably in a better position than New Zealand to capitalise on opportunities, given their access to skills, materials and capital."
O'Riley says with Covid being an ever-present threat, New Zealand is sailing into some difficult waters without a clear set of navigation tools or a coherent approach.
There needs to be a balance between maintaining and growing our economy and internal Government policy priorities and the health threats posed by Covid.
"We have heard the plan for reconnecting New Zealand to the world. Parts of it need to be turbo-charged when we are able.
"And a key is seriously ramping up our vaccinations, testing and MIQ capacity."
Higher vaccination rates provide more options to open up as an economy, reconnect with the world, and more importantly, perhaps, reduce or even eliminate the need for harsh Alert Level 4 lockdowns, says O'Riley.
"It's great to see vaccinations ramping up.
"I would like to think we'll still see the self-isolation pilot in action, the risk-based border pathway, and new testing and vaccine checking systems at the border in the near allowable future.
"In addition, we must implement saliva testing as a practical workplace tool to get people back to work quicker if there is an outbreak. It is easier, less invasive, just as accurate, doesn't tie up labs already processing other Covid tests, and is available right here, right now.
"And we've got to fix the issues that plague the MIQ booking system."
EMA is pushing for the private sector to build a permanent MIQ facility outside of Auckland, and proposes an area such as Manawatu, taking advantage of the proximity of the New Zealand Defence Force facilities at Ohakea, Linton and Waiouru, and creating the opportunity for expanding hospital facilities in Palmerston North.
O'Riley says at its most basic level, the current immigration and MIQ system is no longer fit-for-purpose. The human issues around separated families, critically ill people seeking a return home and those denied the chance to mourn their loved ones should be enough to convince government to change and enhance the system.
The longer the isolation and elimination strategy remains, the greater the strains on critical business relationships in international markets. Businesspeople need to be able to get back overseas when they are vaccinated.
"We need a system that adds capacity and allocates places to those people leaving (on business) and those international business people coming here to fill desperately needed roles or carry out technical reviews and maintenance on critical equipment. Now is the time to recognise Covid will be with us for the long-term and we simply need a system that recognises that reality."
O'Riley is also advocating an overstayer amnesty, which will increase the available workforce and remove a significant caseload from Immigration New Zealand, enabling it to focus on other issues.
Stresses on international and domestic supply chains are going to remain and will flow through to supply shortages and cost increases. Higher electricity costs are also hurting businesses already facing challenges from increased wage costs.
O'Riley says the wage costs are coming from two areas — the government's ongoing burst of employment law changes; and the rampant poaching of staff, particularly by expanding government agencies without the same salary setting constraints.
"We are all competing for the diminished talent pool that has resulted from our closed borders."
The EMA believes New Zealand needs to put more of its own people into training, and increase productivity.
Another critical approach is to create the incentives for businesses to invest more in technology and software, consistent with industry transformation goals — a move that will mitigate staff shortages and also increase productivity.
O'Riley says hard-pressed businesses impacted by multiple lockdowns need some assistance to help manage them through those changes, including more readily available research and development funding.
"Government has been generous with its assistance during the Covid outbreaks, but that's mainly been targeted at employees while costs continue to rise for employers.
"The mood of the boardroom will change once we see a coherent plan and policy settings from government that enable businesses to sustainably increase productivity and performance, while continuing to reshape our operations in a pandemic world."
O'Riley says business is up for the challenge and wants to be part of developing that plan.
Brett O'Riley's top issues
Need for a coherent plan: One that balances government policy priorities with external factors and the realities of doing business.
Inflationary pressure: This is driving up costs for businesses, reducing profitability and their ability to invest in productivity gains.
Vaccination rates: These need to be increased along with the ability for people to cross the international border.