Tokoroa’s Kinleith Mill, a cornerstone of New Zealand’s paper industry, will cease paper production by June, a decision impacting approximately 230 jobs. Oji Fibre Solutions, the mill’s owner, cites years of profitability struggles within the sector as the primary driver.
"We’ve reached a juncture where simplification of operations is the most viable path forward, ensuring continued supply to our customers while aiming to retain employees in the region," stated Dr. Jon Ryder, Oji’s CEO.
Extensive consultations with staff and unions preceded this difficult decision, according to Oji, emphasizing their commitment to transparency throughout the process. While paper production will cease, the mill will shift its focus to pulp production, a move aligned with industry trends and aimed at securing long-term stability.
This transition, however, is met with mixed emotions. Unions representing the affected workers, particularly E tū and FIRST Union, express concern and criticism.
"The company’s neglect of essential maintenance points to a lack of true commitment to paper production’s future," stated Ian Farrell, senior delegate with E tū. Mario van der Putten, senior FIRST Union delegate, lamented the loss of "the last paper-making machine in the country," highlighting broader economic repercussions for industries relying on paper products for storage and logistics.
The economic impact on Tokoroa is substantial, prompting the South Waikato Mayor Gary Petley to pledge support through "Project Phoenix." This program aims to facilitate job transitions and provide resources for displaced workers.
This closure adds to a growing list of manufacturing sector setbacks in New Zealand. The closure of Oji’s paper recycling mill in Auckland’s Penrose in December 2024 closed, impacting 75 jobs. Together, these events underscore the vulnerabilities of traditional industries in the face of global competition, rising energy costs, and evolving market demands.
This bleak landscape necessitates proactive government policies, industry innovation, and workforce development strategies. A focus on diversification, research into new market opportunities, and investments in retraining programs are crucial for building a resilient and thriving manufacturing sector in New Zealand’s future.
To address the immediate needs of those affected by the Kinleith closure, specific strategies must be implemented. These include:
- Rapid Retraining Programs: Prioritize programs tailored to the skills of displaced workers, focusing on in-demand sectors like renewable energy, construction, and technology.
- Job Fairs and Recruitment Events: Organize platforms connecting affected workers with employers seeking skilled labor in the region. Leverage existing government agencies and industry partnerships to facilitate this process.
- Financial Support: Offer targeted financial assistance, including extended unemployment benefits and grants for retraining expenses, to ease the financial burden during the transition.
- Collaboration with Local Businesses: Work with local businesses to identify opportunities for redeployment and upskilling existing staff. Support programs that encourage apprenticeship and on-the-job training in related fields.
- Long-Term Economic Diversification: Invest in regional economic diversification initiatives to create a more resilient economy with less reliance on a single, struggling industry. This could include promoting tourism, supporting small businesses, and fostering innovation in areas with regional strengths.
Failing to address the needs of displaced workers will not only have a detrimental impact on their lives but could also stifle economic recovery in the region. Investing in thoughtful and comprehensive support systems is crucial for mitigating the negative consequences of the Kinleith Mill closure and building a brighter future for the Tokoroa community.