Govt lifts minimum wage 50 cts to $13.50 an hour

BusinessDesk: New minimum wage to be 40% of average public sector pay, 55% of average private sector pay

8th Feb 12, 2:23pm by BusinessDesk

The government will lift the minimum wage 50 cents to $13.50 an hour from the start of April.

Labour Minister Kate Wilkinson said the “increase strikes the right balance between protecting low paid workers and ensuring that jobs are not lost during these tough economic times.”

The training and new entrants’ minimum wages rose 40 cents to $10.80 an hour.

The government has consistently resisted calls to hike it up to $15 an hour, saying that would lead to some 6,000 job losses.

The hike comes a day after government figures showed average hourly earnings rose 2.8 percent to $26.59 an hour in the 2011 calendar year. That was made up of a 2.8 percent rise in private sector wages to $24.58 and a 3.2 percent increase in public servant pay to $33.86 an hour.

(BusinessDesk)

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15 Comments

by skudiv | 8th Feb 12, 3:08pm 1328666895

And that is how all public sector employees should get a pay rise. In line with the increase in the minimum wage, and the private sector. Somehow, these fat cats rationalise a 14% pay rise, while the private sector takes 2.8%.

Sounds like the standard of living is dropping, with inflation over 5% last year. As the rich get richer and poor get poorer.

by Wolly | 8th Feb 12, 3:15pm 1328667359

Please return you invitation to Sir Humphrey Applebee's dinner Mr Skudiv...you are no longer an acceptable guest at the club.

by Andy Rodgers | 8th Feb 12, 3:16pm 1328667396

"That was made up of a 2.8 percent rise in private sector wages to $24.58 and a 3.2 percent increase in public servant pay to $33.86 an hour."

So workers in the public service get paid (I won't say earn) almost 40% more than workers in the private sector. I live in the Waipa district in the Waikato and it has just been announced that 16 council workers earn over $100,000 p.a. This is in a council area with a population of about 40,000 people. How many private sector workers within the district earn six figure salaries. The average wage in Waipa in September 2007 was $26,500. And people wonder why the Gov't has to borrow $300 milion per week.

by Banksterbasher | 8th Feb 12, 3:17pm 1328667440

Remind me again why public sector employees are being paid on average more than private?

by economist | 8th Feb 12, 3:45pm 1328669155

...because they don't have to actually earn it bb

by Kakapo | 8th Feb 12, 3:53pm 1328669583

Because there isn't that vast tranche of minimum wage supermarket, retail, cleaning and fast food jobs to drag the average down.

by Patricia | 9th Feb 12, 11:26am 1328739965

Exactly Kakap.

by muzza | 8th Feb 12, 4:51pm 1328673095

At the risk of being accused of heresy, and being out of sync with the preconceived attitudes of most who post on the site, it might have something to do with the academic and professional qualifications attained compared with the relative lack of many workers in private enterprise jobs. Just trying to come up with some rational factor.

I have actually employed some quite outstanding highly qualified, skilled and goal-oriented people who have had public sector work or teaching experience, who have been top-notch.

by midgetkiwi | 9th Feb 12, 11:51am 1328741492

Just a comment from one who has worked in both public and private sectors - as someone below mentioned, if you have high-value skills and experience, you can definitely be paid more in the private sector. Another observation from working in the public sector in 2 regions and private in 3, the public sector seems very much less efficient... nothing to do with the employee, i am the same person. In private, improved performance = improved income, in public however perceived performance = improved income.

Just wondering if any stat has been collected about % of administration related jobs comprising the public and private sectors... seems like private sector you get paid to work, whereas in public you pay people to "efficiently" employ people to create "efficient" systems which require "efficient" people to support people who actually carry out a service or supply goods... or maybe i have tunnel-vision

by dug | 8th Feb 12, 7:23pm 1328682204

As an employer for the last 30 years it still amazes me that successive governments believe that automatic wage rises are sustainable without any productivity justification. The faqct that govt officials believe they are worth so much is what happens with bureacracy in the end look at Greece when it all falls over who pays the piper

by midgetkiwi | 9th Feb 12, 11:55am 1328741749

You're right dug, there is no or little productivity justification. Has to keep the crazy world spinning though, when inflation is occuring (and without even counting housing, the biggest cost and inflation source of all), money is printed by governments, and created by banks to ... pay themselves more. I can't personally lay this fault with any party however, but rather at successive governments corruption, greed, and gutlessness to address the currency system problem.

by Nic the NZer | 9th Feb 12, 12:29pm 1328743768

How very generous of you to share. Minimum wage increases have not even kept up with CPI inflation for the last 30 years.

by SimonP | 8th Feb 12, 8:24pm 1328685887

I really don't understand the above rants. Someone with high demand skills will almost always earn more in the private rather than the public sector. I also think a well-rounded education can help in doing a job better and more efficiently, doing something the way it's always been done doesn't improve productivity and your competition won't be standing still.

by muzza | 8th Feb 12, 8:40pm 1328686815

Simon, such rants are easy to understand, they stem from ignorance, of course an ignorant person won't see any value in someone being educated and skilled. Ask any high school teacher- the difference in attitude and work ethic of the top stream students is a league apart from those in the lower streams. It's intriguing however when some who decry being well educated want their children to 'do better' and get good qualifications. I have always looked for an employee to be an achiever, it's an attitude they bring with them, as well as of course the skills they have acquired. And often the high achiever is a well rounded person active in the arts,sports, comunity service etc. And some do play a role in the public service and are paid accordingly.

by Kunst | 8th Feb 12, 9:38pm 1328690300

In nations, where rich people are allowed to accumulate increasingly more money, inequality grows and as a consequence societies will collapse.

Holding wages in New Zealand over NZ$ of 200’000.- over 12 months – and in most businesses discussions over minimum wages would be a thing of the past.