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Alliance Shortsighted Over Minimum Wage Rise

Alliance Does It Again With Policy To Increase Minimum Wage

The Alliance plan to increase the minimum wage has today been attacked as an extreme shortsighted policy that would put low skilled workers out of a job.

ACT Party President Sir Roger Douglas today said that Jim Anderton's call for a 50 cent per hour increase in the minimum wage is yet another example of a politician exaggerating the benefits ignoring the costs.

"We must consider the impact of this approach always remembering that a higher income and standard of living are dependent upon higher productivity and output. There is a distinct relationship between a nation's per person income and it's per person output.

"A higher minimum wage as proposed by the Alliance will price some low-skilled New Zealand workers out of a job. Therefore employment will decline, unemployment will rise, reducing total output. While some individual workers may be helped, overall, per person income will be lower because per person output will be lower.

"When secondary effects are considered the impact on employment is clear - well done Jim, you've done it again," said Sir Roger Douglas.


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