MEDIA RELEASE

19 November 2002

Higher Wages Needed to Address Skills Shortage

“The latest Department of Labour’s Skill Shortages report confirms the need to focus on skill development and better matching of the unemployed with vacancies,” said Paul Goulter, secretary of the Council of Trade Unions today.

Paul Goulter said skills shortages would not be solved without higher wages.

He noted that the report does not distinguish between genuine skills shortages and recruitment difficulties which occur when there are skilled workers available but the wages and conditions do not match the skills level required.

“The CTU supports a high wage, high skill, high trust economy and this requires a much higher level of investment in education and training as well as physical infrastructure.”

Paul Goulter said the Government had made a good start in terms of modern apprenticeships, commitments to lift numbers in industry training, and a number of Labour Department initiatives on skills development.

“But more needs to be done,” he said.

“Wages need to rise to meet the circumstances of skill and labour shortages.”

Paul Goulter said there was room for non-inflationary wage growth in the economy and it should be remembered that New Zealand wages still lagged around 26% behind Australia.

ENDS

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