10 OCTOBER 2000 Falling Dollar Forces Ihug Review A record fall in the value of the New Zealand dollar is one of the key factors behind cost cutting measures announced by Ihug today. The company has confirmed it is now reviewing staff numbers in the wake of the dollar's recent slump. Since the start of the year, the embattled New Zealand dollar has plummeted 22 per cent against the greenback. The dollar crisis has had a big impact on Ihug's operating costs. The company - New Zealand's second largest Internet service provider - buys large amounts of bandwidth and hardware, all in US dollars. Ihug currently employs more than 350 staff both in New Zealand and Australia. The company has warned it may have to shed around 60 jobs. More details will be passed to staff as review work is completed over the next day or two. Ihug Director Nick Wood says Ihug will continue to be a leader in providing cheaper, faster Internet access. But he says the falling dollar has forced the company to refocus on core activities. Mr Wood says Ihug will be offering support and advice to any worker whose job is lost. "We have held off on restructuring for as long as possible," he says. "We are a privately owned NZ company and we must run in the black, unlike our bigger foreign owned competitors. In these tough economic times, that means running a tight ship. It is unfortunate but unavoidable. We will naturally do everything we can to assist those affected by the job losses." Mr Wood says Ihug staff are well trained and frequently in demand from other telecommunications companies and new start-up ventures. He is hopeful many of the staff will quickly find work elsewhere in the industry.
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