CTU media release

Figures released today ahead of unemployment statistics on Thursday reflect the loss of jobs in the past year, says the Council of Trade Unions. Hours worked are down by almost 2 percent and there are 17,000 fewer jobs in manufacturing and 9,000 fewer in construction. This shows the need for more urgency in measures to create and retain jobs as well as step up the support for those losing their jobs.

The CTU also says that wages need to rise during the recession. “A wage freeze will not help stimulate the economy,” said CTU Secretary Peter Conway.

The Quarterly Employment Survey measure of wage movement was released today and Labour Cost Index figures due on Wednesday will round out a more complete picture on wage trends. Ordinary time hourly wages increased by 5.3 percent in the March 2009 year compared with 5.4 percent in the December 2008 year.

Conway says that there are several downward pressures on wage growth including lower inflation, concern about job security, affordability in the case of some employers and cuts in government spending. However recent surveys have showed that skill shortages are persisting in many areas of the economy.

“It is not a jobs versus wage increase scenario,” continued Conway. “It is not high wages that created the recession. Obviously households are concerned about jobs but we also need reasonable wage increases if we are to come out of this recession sooner rather than later.”

“There is also the issue of fairness. The recent tax cuts were biased towards those on high incomes. Around a third of the $800 million went to the top 3 percent of earners. And although the minimum wage went up by 4.2 percent last month, there are many workers on more than $12.50 an hour who need a decent wage rise this year.”

“In addition, the 30 percent lag we have behind Australian wages is not going to disappear because of the recession. Even to meet the Government’s goal of catching up with Australian wages by 2025 will require New Zealand wages to rise each year by nearly 2 percent more than Australian wage increases. The longer the catch-up is delayed, the harder it gets.”