Wages rises still well behind inflation

Tuesday, 1 November 2011, 12:26 pm
Press Release: New Zealand Council of Trade Unions

CTU Media Release

1 November 2011

Wages rises still well behind inflation

“The 2.0 percent increase in the Labour Cost Index for the year to September means that wages are still falling behind price increases”, says CTU Economist, Bill Rosenberg. Prices increased 4.6 percent in the same period, including about 2.1 percent due to the GST increase.

He noted that “56 percent of people got pay rises in the last year. Those who did got a median rise of 3.0 percent and average of 3.6 percent. So even most of the people who got a rise didn’t keep up with the rise in prices.”

Similarly, the average hourly wage rose 3.2 percent to reach $26.53, again behind price rises. Rosenberg noted that this was approximately where average wages were in 1972 in real terms (that is, after taking account of CPI inflation).

“Some people have had compensation for the rising prices from tax cuts, but this was heavily weighted to higher incomes. People on lower incomes will be feeling the effect of the price rises much more strongly,” said Rosenberg.

The number of filled jobs was almost flat over the year, rising only 0.6 percent, with an 0.7 percent increase in full time jobs being offset by a 0.4 percent loss of part time jobs.

ENDS

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New Zealand Council of Trade Unions

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