Living wage at Christchurch City Council will do more harm than good

30 AUGUST 2018
FOR IMMEDIATE RELEASE

Responding to Christchurch City Council’s intention to pay all Council Controlled Organisation staff a living wage within the next three years, Taxpayers’ Union Economic Advisor Garrick Wright-McNaughton says:

“Living wage policies often do more harm than good to the very people they purport to help. When Wellington City Council implemented a living wage, seventeen low-skilled workers lost their jobs.”

“Councils hire staff based on merit. Given the option between hiring a low-skilled and high-skilled worker at the same wage rate, councils will hire the high-skilled worker. Individuals who are below the skill level commensurate with the living wage will be crowded out by higher-skilled applicants, making it harder for low wage earners to find work.”

“In addition, many ratepayers, who will now have to pay more for this virtue signalling policy, don’t earn the living wage themselves. If Christchurch City Council really wanted to reduce poverty in the city it would cut wasteful spending, focus on core services, and ensure value for money to every resident living in the Garden City.”

The Taxpayers’ Union’s report, Living Wage Policies: The Best Of Intentions But The Worst Of Results, is available online at https://www.taxpayers.org.nz/living_wage.

ENDS

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