Wednesday, February 08, 2006

Employment slowing

Just released from Statistics NZ comes the December 2005 quarterly employment survey.

Of note is total paid hours worked has hardly changed in the past year. First time this has happened since 1998.

But the growth in hourly earnings has increased by 5.4 percent. (Not mentioned in the press release is growth in the public sector earnings was higher at 6.7 percent -what's that about inflation Mr Cullen?)

So employers are paying out more for the same amount of production.

And Sue Bradford wants, on top of the extra weeks holiday that kicks in this year, a further rise in the youth and minimum pay rates. (I notice Peter Dunne, the new champion of business is going to vote to send her bill to select committee.)

Add to this Treasury's prediction that thousands of jobs will be lost this year and the Green's campaign looks reckless.

UPDATE The Maori Party have also come out in support of raising the minimum wage. If anyone can understand what Pita Sharples is inferring with his reference to WFF in this release, let me know.


Anonymous said...

"So employers are paying out more for the same amount of production."

I guess it all depends how you measure production - the number of hours worked or the number of units produced per hour of work.

So I do not consider it a cause for concern that the total paid hours has hardly changed in the past year if productivity per hour worked has increased.

Sue Bradford's proposed extra weeks annual leave and the increased minimum wage will increase employer's costs without increasing production so employers will be justified in foregoing any pay increases for the time being. The workers won't see it that way of course.

On the subject of labour and wages why is it that workers continue to work for an employer who provides unattractive working conditions? The current strike at the Taylor Prston meatworks is a good example. If the conditions are so bad why haven't the workers left and found better conditions elsewhere? I suspect it is that they come to depend on the union or the government to look after them and lost the ability to look after themselves.

Lindsay Mitchell said...

Fair point. Productivity may have increased. Improved technology eg high speed internet access, can improve productivity. It has mine!
The extra week's leave has already been legislated.
On the matter of Taylor Preston, when I read their workers half page ad in the DomPost describing their grievances I wondered the same. I guess there is a certain inertia at play. Most people don't like change. But working there must have something going for it.
Oh and with govt assistance, like accommodation supplement for low income workers, if they move to higher wages they can lose that extra income. That'll happen if they stay and get a wage rise, too. But the Unions would rather it came from the employer than the public purse (ignoring that business/employers pay a truckload of tax.)
The ad was full of how rich the family are. Did you know, for instance, they once owned gold mine in Canada?!! Criminal.