Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Why is the Reserve Bank happy with low wage growth?

Media release

Why is the Reserve Bank happy with low wage growth?

“There seems little prospect for better wage growth if the Reserve Bank is to be believed”, says CTU Economist Bill Rosenberg. “It says the slow wage growth is because of more people wanting jobs, rapid immigration growth, and the high unemployment rate.”

“This is a circular argument. People are being forced into the job market because stagnant wages mean more people have to work for the needs of their households. At the same time harsher rules on social welfare benefits and the low level of those benefits force people into a job market where as the bank says, there is ‘elevated unemployment’. In these circumstances, immigration should not be used to undermine workers rightly asking for wage increases.” Rosenberg said.

“There is a high risk that growth peaks this year without most people seeing any sign of it in their pay packets.” Rosenberg said.

“The Reserve Bank’s rhetoric is not encouraging. It seems to see wages as just another price and it will rally against any significant rise in them. There is no recognition of the needs of workers who depend on wages for their livelihoods, nor of their productivity, which has risen much faster than real wages since 2009. The implication is that if wages do rise faster the Reserve Bank will clamp down with higher interest rates.” Rosenberg said.

“At the same time the Reserve Bank acknowledges the longstanding problem with the overvalued exchange rate. It seems to think it is a mystery, and just sits on its hands. There are policies that could be used in New Zealand to help address it. A more competitive exchange rate would help high value exporters and reduce our reliance on commodity exports whose prices have peaked, while creating better jobs.” Rosenberg said.

“Meanwhile there is little sign of a pause in interest rate rises.” Rosenberg said.

ENDS


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Parliament Today:

The Kids: OECD Report Shows Huge Impact Of Poverty On Education

A new report from the OECD has again highlighted the negative effects of poverty, showing that disadvantaged children in New Zealand are more than six times more likely to underachieve in maths than children from wealthier homes. More>>

ALSO:

Pacific: NZ Pledges $500,000 To Help Address Zika

“With the Zika virus now confirmed in a number of Pacific countries, New Zealand is committed to helping limit the impact and spread of the virus in the region,” says Mr McCully. “New Zealand will provide $250,000 as a contribution to the WHO to implement the Pacific Zika Action Plan, and a further $250,000 to enable countries in the region to respond rapidly if required." More>>

ALSO:

Labour: Police Commissioner 'Doesn’t Get Force Needs'

The Police Commissioner has let down the public and his own force by insisting the police have what they need despite it taking a year to solve a burglary and overwhelming number of officers saying they are under-resourced, says Labour’s Police spokesman Stuart Nash. More>>

ALSO:

Gordon Campbell: On The US Pressure To Expand Our Role In Iraq

Foreign news services are being more forthcoming about what the “next 12 months” will entail – essentially, the defence ministers will be under US pressure to increase their “training” role preparatory to an assault on the city of Mosul in northern Iraq. More>>

ALSO:

Parliament Restarts: Prime Minister’s Statement

Our policy agenda and legislative programme will reflect the Government’s four priorities: • to responsibly manage the Government’s finances • to build a more competitive and productive economy • to deliver better public services to New Zealanders, an • to support the rebuilding of Christchurch. More>>

ALSO:

NZEI Survey Report: Special Needs Students Missing Out

The survey revealed that around 16 percent of students were on schools’ special needs registers, but nearly 90 percent of schools’ special needs coordinators did not believe there was adequate support for students and their learning... More>>

ALSO:

Interim Report: Waitangi Tribunal On Ture Whenua Legislation

Labour on Proposed changes to Maori land rules: “To have Treaty Negotiations Minister Chris Finlayson dismiss findings as ‘bizarre’ is totally disingenuous and disrespectful. What’s bizarre is Maori Development Minister Te Ururoa Flavell stubbornly pushing through this Bill before the Waitangi Tribunal has even completed its report..." More>>

ALSO:

Spy Update: Appointment Of GCSB Acting Director

GCSB Chief Legal Advisor Lisa Fong will become the Acting Director of the Government Communications Security Bureau (GCSB) from 15 February 2016, Minister Responsible for the GCSB Christopher Finlayson announced today. More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news