17 jobs lost, more to go under WCC's living wage policy

MEDIA RELEASE

REVEALED: 17 JOBS LOST, MORE TO GO UNDER CITY COUNCIL’S LIVING WAGE POLICY

20 FEBRUARY 2017
FOR IMMEDIATE RELEASE

Seventeen parking wardens contracted by Wellington City Council were not rehired in-house, with further job losses inevitable under the Council’s living wage policy, according to a new report written by Jim Rose for the New Zealand Taxpayers’ Union published today.

Key Findings:

• Seventeen Wellington City Council employees lost their jobs after being under the skill level required for the living wage.

• Councils hire on merit, so candidates under the skill level commensurate with the living wage will be crowded out by higher-skilled candidates.

• There is no consensus or scientific basis for the calculation of a living wage. Any calculations are politically subjective.

• Any living wage in New Zealand will be abated by up to 40% by decreases in government transfers and increased income tax obligations.

• Living wages shift the burden from means-tested taxpayers to ratepayers – no matter their ability to pay.

• Below-living-wage employment allows for in-work training, where employees trade off lower wages for the opportunity to learn skills that increase their future earning potential.

Best of intentions, worst of results: a review of the New Zealand experience and international evidence on living wage policies, by Jim Rose, is available for download at www.taxpayers.org.nz/living_wage. Hard copies of both a summary report and the full paper are available on request.

Taxpayers’ Union Executive Director, Jordan Williams, says:

“Living Wage Aotearoa New Zealand nobly want to alleviate poverty and reduce unemployment with their activism for a living wage, but the evidence to date shows they are achieving the exact opposite. This report shows that a living wage will only make it harder for low wage earners to find work”.

"Contrary to intentions, living wage policies actually hurt the very people they seek to help. For the first time, we reveal that seventeen parking wardens lost their jobs at the Wellington City Council as a result of its living wage policy."

“Living wage policies mean higher-skilled candidates apply for jobs previously occupied by lower-skilled candidates. Of course councils will hire on merit and shortlist the candidates who previously would never have applied for the lower, pre-living wage role. That's exactly what happened when Wellington City Council brought its parking services in-house."

“Minimum wage applicants do not get a shot against better-qualified candidates attracted by the higher wages. So much for the poverty alleviation and reduced unemployment.”

"The economic theory is clear that living wages do more harm than good, but the job losses in Wellington is the proof in the pudding. Councils should stop implementing these living wage policies which achieve so little but cost ratepayers who can ill afford it."

"Living wage policies mean ratepayers pay more for less and achieve none of the intended poverty relief."

ENDS

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