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Employers should take lead from DHBs

Employers should take lead from DHBs

“The recent 40% pay increase over three years for hospital service workers sets a benchmark for other employers of low paid New Zealand workers” said Peter Malcolm spokesperson for “Closing the Gap” the Income Equality Aotearoa NZ Inc

“New Zealand has had a culture of too many workers on very low wages at a time the economy is doing well. We need to see the rewards of a strong economy spread across the workforce and not just rewarding the already well off” he said.

Mr Malcolm said there is a great deal of data now being published by internationally respected economists that indicates the best base for a growing economy is to have increases in incomes more evenly spread rather than concentrated around the already well paid. This is because the lower paid will spend their newly acquired income to the benefit of local economic activity rather than spending on overseas holidays or investing in property.

It was this strategy that turned Singapore from a post war third world country to one of the strongest economies in Asia. Government policy explicitly aimed to move away from a country relying on cheap wages to the present highly skilled and well paid workforce that characterises Singapore today.

If there was ever a time to make the same move in New Zealand it is now at a time of full employment. New Zealand has very low levels of productivity by international standards and many businesses will need to rise to the challenge of becoming more efficient and productive and passing at least some of these gains back to workers.

“The argument that increasing wages will increase unemployment is negative and reactionary. Business owners should now work to bring productivity and wages to internationally competitive levels” he said.

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