Wages argument doesn’t stack up

Business New Zealand’s narrow view about what is good for the labour market and for the economy undermines its credibility and shows it may have little to offer the debate on increasing the national income and sharing it fairly, Labour’s spokesperson on Labour Issues Andrew Little says.

“Just as the rest of the country is waking up to the fact of growing inequality and an increasing wage gap Business New Zealand calls for a lid on the minimum wage and more deregulation of the labour market.

“New Zealand is recognised by the World Bank as having had one of the most deregulated labour markets for nearly 25 years, yet over the same period incomes for the bottom 50 per cent of earners has remained static or gone backwards.

“If the average wage in New Zealand had kept pace with improvements in productivity over the last twenty years, it would be between $7 and $8 higher than it is now.

“Last year, while the economy grew by more than 3 per cent, 46 per cent of wage and salary earners didn’t get a pay rise.

“Forty per cent of children living below the poverty line come from families and households with a working adult.

“The critical issue in New Zealand’s labour market is its failure to provide adequate wages to most working people. That Business New Zealand’s manifesto has nothing to say about this shows it can’t be taken seriously.

“Extending the 90-day ‘no rights’ period to 12 months would create even more job insecurity and would be a retrograde step for productivity and good quality management decision-making.

“New Zealand is in desperate need of a constructive debate about making our labour market work for all participants – employers and workers alike. Mindless, out-dated demands for even more wage suppression and greater job insecurity have no place in that debate.

“Labour is committed to lifting the minimum wage, investigating new measures to ensure all workers get a fair share of the national income and ensuring labour market regulation encourages high productivity management conduct, not low-road, low-rent behaviour encouraged by Business New Zealand,” Andrew Little said.