Very Small Catch-up for Wages, But Uneven Gains

Very Small Catch-up for Wages, But Uneven Gains
 
“The 2.0 percent increase in wage levels for the year to March seen in the Labour Cost Index statistics released today, shows some wage and salary earners are getting a modest catch-up when compared to the 1.6 rise in CPI, after high inflation last year”, says CTU economist Bill Rosenberg.
 
“However, rises are slowing, 0.4 percent in the quarter compared to 0.5 percent last quarter and 0.6 percent the two quarters before. The increases are below forecasters’ expectations, and not all New Zealanders are sharing in it equally. Higher income earners got higher rises, particularly in the private sector. There is a growing difference between private sector and central government pay increases, and paid hours and part-time employment have fallen in some industries according to Statistics New Zealand.”
 
“Many New Zealanders have been voting with their feet, with the highest ever migration to Australia in the last year.”
 
There is a growing difference in the private sector between the median increase of 3.0 percent (half of those receiving an increase got less than this) and the average increase of 4.0 percent which is weighted towards higher incomes.
 
In the last three months, the median increase for private sector employees who got a pay rise was 3.1 percent, while it was only 2.0 percent in central government.
 
“Without more substantial and consistent increases in wage rates, the move to Australia will continue and demand for local goods and services will continue to be weak,” says Rosenberg “neither is good for the economy.”
 
ENDS

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