At least 1000 jobs will go at one of our biggest companies, and the boss of Fletcher Building isn't ruling out more.
Ross Taylor says the job losses will be across the entire company, describing the financial hit of Covid-19 as "significant".
Another 500 will go in Australia.
April's lockdown means the company made no money in New Zealand that month, while across the ditch, it was down to about 90 per cent of its usual revenue.
Mr Taylor told media in a conference call this morning that while it's now ramped up, problems continue.
A month-long consultation process will now happen as the company works out where the redundancies will be made.
All workers will receive a four-week redundancy package, plus help with CV writing and other assistance.
But if the financial situation worsens, Mr Taylor says there may be more job losses.
Some big projects may face delays - including Auckland Airport's new domestic terminal, as well as the troubled Sky City convention centre build.
But he couldn’t say what other projects may be impacted.
Fletcher received $67 million from the first round of the Government's wage subsidy scheme for its nearly 10,000 New Zealand employees. But it has not, and will not, apply for the second.
Mr Taylor says the company doesn't qualify this time around and he thinks businesses should remain independent.
"The country needs strong independent businesses, not ones that become dependent on Government."
And the predictions for the residential construction sector are dire.
Mr Taylor thinks we'll see a drop in residential consents of up to 30 per cent.
Residential construction makes up 50 per cent of the company’s business, with commercial and infrastructure 25 per cent each.
While the infrastructure sector will hopefully boom once the Government’s plans to inject billions into “shovel-ready” projects kicks into gear, that will still take some time.
The company has applied for a number of those and Mr Taylor says he’s comfortable the company will be able to compete.
Fletcher Building will also reduce costs where it can across the rest of the company, including consolidating its headquarters and reducing travel.
New Zealand’s strict four-week lockdown meant a huge hit here, but Mr Taylor says the different approaches taken by the Australian and New Zealand governments will even out and he expects the impacts to be similar in the long run.
"Looking to the next financial year, we are planning for an environment that will see a shrinking economy, substantially reduced customer demand across all our businesses and sustained lower levels of productivity," he said.
"As a major employer, we need to ensure our business is resilient and can support economic growth in the longer-term, just as we have done for more than 100 years. While this has meant having to make tough decisions, we want to thank all of our people for their valuable contribution to Fletcher Building."