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Growth In Employment And Wage Rates

Labour Cost Index and Quarterly Employment Survey: December 2001 quarter

Quarterly Employment Survey (QES) figures for November 2001, released today by Statistics New Zealand, show seasonal growth in employment, paid hours and gross earnings. The Labour Cost Index (LCI) for the December 2001 quarter, also released today, shows slightly higher annual growth in wage rates.

The November 2001 QES shows an increase in employment from August 2001, with full-time equivalent employees (FTEs) and filled jobs increasing by 2.7 percent and 3.1 percent respectively. There was a 3.1 percent increase in FTEs in the year to November 2001. Seasonally adjusted total paid hours and total gross earnings also increased from August to November 2001, by 1.2 percent and 1.8 percent respectively. Annually, seasonally adjusted total paid hours increased by 3.2 percent, and seasonally adjusted total gross earnings increased by 6.6 percent.

Average total hourly earnings, as measured by the QES, increased by 0.3 percent from August to November 2001. In comparison with recent quarters, this quarter's smaller movement is due primarily to increased employment and paid hours in industry groups with typically lower average hourly earnings. Annually, average total hourly earnings increased by 3.3 percent from November 2000 to November 2001.

Private sector average ordinary time hourly earnings were $17.43 in November 2001, 0.3 percent higher than in August 2001. In the year to November 2001, private sector average ordinary time hourly earnings increased by 3.3 percent.

The QES average earnings statistics reflect not only changes in pay rates, but also compositional and other changes in the workforce. By comparison, the LCI measures changes in salary and wage rates for a fixed quantity and quality of labour input.

Salary and wage rates (including overtime), as measured by the LCI, increased by 0.5 percent from the September 2001 quarter to the December 2001 quarter, following increases of 0.6 percent in the September 2001 quarter and 0.4 percent in the June 2001 quarter. Quarterly increases averaged 0.5 percent during 2001 compared with 0.4 percent during 2000.

On an annual basis, salary and wage rates were 2.1 percent higher in the December 2001 quarter than in the December 2000 quarter. This follows an increase of 2.0 percent from the September 2000 quarter to the September 2001 quarter. The annual increase from the December 1999 quarter to the December 2000 quarter was 1.6 percent.

LCI public sector salary and ordinary time wage rates rose by 0.7 percent in the December 2001 quarter. This follows an increase of 0.6 percent in the September 2001 quarter. The December 2001 quarter rise includes the first of two increases from the recently settled primary school teachers' and principals' agreements. On an annual basis, public sector salary and ordinary time wage rates were 2.2 percent higher than in the December 2000 quarter.

LCI private sector salary and ordinary time wage rates rose by 0.5 percent from the September 2001 quarter to the December 2001 quarter and are now 2.1 percent higher than a year earlier. Of the private sector ordinary time pay rates that rose from the December 2000 quarter to the December 2001 quarter, the average increase was 4.3 percent. This follows annual increases of 4.2 percent for the year to September 2001 and 3.5 percent for the year to December 2000.

Major reasons given by employers for larger than average ordinary time pay rate increases during the past year were matching market rates, retaining staff and attracting staff. Three in five pay rate increases of more than 5 percent were for these reasons, compared with one in five for increases of up to 2 percent.

Brian Pink
Government Statistician

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