Falling economic growth – wage rises overdue
CTU MEDIA RELEASE
18 September 2014
“The lower GDP growth in the three months to June is further evidence that growth has peaked. New Zealand’s economy is on the way down to mediocre growth rates,” says CTU economist Bill Rosenberg. “Yet wage rises are still weak with 43% of wage and salary jobs not getting a pay rise in the last year, and the big question is whether wage and salary earners will get a fair share of the growth that has occurred.”
The last quarter has seen growth mainly in services, while production in most of the tradables sector including agriculture, forestry, fishing, mining and manufacturing fell. The quarterly growth was lower than Treasury and Reserve Bank forecasts.
“The growth is still strongly oriented towards construction and related services. It reinforces the view that better policies are needed to support high value exports and competition with imports, with trade data showing that the highest value (elaborately transformed) manufactured exports having fallen in value and as a percentage of exports,” said Rosenberg.