Has the city shaken its $10 Tauranga tag yet? Photo/file
Tauranga residents seem to be paid less than the national average - something industry leaders have put down to the city's labour market and the availability of skills.
The minimum wage rates for employees aged 16 and over is $15.75 per hour, $126 per eight-hour work day, $630 per 40-hour week and $1260 per fortnight. The minimum wage for an employee just starting out or in training is $12.60 per hour.
Priority One communications and projects manager Annie Hill said Tauranga's average earnings in 2016 was $52,800, slightly lower than the national average of $57,780.
While some believe the $10 Tauranga reputation still exists, Ms Hill said the tag was inaccurate and had been for some time.
"Above the minimum level set, salaries and wages paid are very much about the labour market and the availability of skills," Ms Hill said.
"If skills are scarce, then they are worth more, whereas if they are plentiful, employers are in a stronger negotiating position."
However, Ms Hill said from an economic development perspective the outlook seemed more positive for Tauranga.
"We have seen robust business and job growth over the last few years and there is strong demand for both skilled and unskilled workers," she said.
"We are also seeing the job market move to one that is increasingly based on knowledge industries in terms of investment in research and development and more technologically-focused companies, which offer higher value jobs."
Ms Hill said the $10 Tauranga tag was a misnomer that had not been accurate for a few decades.
"When Statistics New Zealand used to analyse the wages at a territorial authority level up until March 2008, the average hourly earnings were over $17 per hour in 2003 and over $20 per hour in 2008," she said.
Tauranga of Commerce chief executive Stan Gregec said the city had not yet shaken off its $10 Tauranga reputation but it was getting there.
"Employers pay what they can, and what they believe is fair," Mr Gregec said.
"However, with escalating house prices and rent in the last few years, it is no surprise that many people are finding it a struggle to meet living costs."
Mr Gregec said he did not want Tauranga to have the reputation of being a low-wage paradise and believed the key to getting rid of it was by attracting more skilled people to the Bay.
"So that is why we need to build the new high-value industries of the future, and also encourage our existing industries to innovate and become even more productive.
"That is what will attract more skilled people to the Bay and bring the wage growth of the future."
Phill van Syp, managing director from 1st Call Recruitment, said wages depended on the job.
"We have everything from people coming straight from out of school right through to labouring basic jobs. I believe that is a number that is suitable," Mr van Syp said.
"If any employer thinks they can get the best employee for their business on minimum wage they would be unimpressed," he said.
Mr van Syp said Tauranga's wages were not as bad as people thought and few employees in Tauranga were getting paid the minimum.
He said the fight for more money in senior roles was higher than Auckland because of the fewer number of "big businesses" in Tauranga.
"It means a lot of people are interested in that senior role and they are paid well, but if you want big money you are looking to move to Auckland unless you get into some of the bigger Tauranga companies."
Mr van Syp said whether people earned enough to meet living costs depended on their definition of what it cost to live in Tauranga.
"I do not think our grandparents had it any easier than we do now, It is just that people want a lot more."
Tauranga Budget Advisory Services manager Diane Bruin said while Tauranga's wages had improved, it was a continuing struggle for trade staff to reach a reasonable wage.
Mrs Bruin said people were not consistently earning enough to meet living costs as the cost of rent had escalated based on demand and availability.
"Food and power has also increased and whilst some can scrape through it is the added debt items that make the package unaffordable."
Credit was still too easy to get and pushed vulnerable people into a negative budget, Mrs Bruin said.
"We still have a lot of seasonal work in the Bay and transient workers particularly in horticulture and hospitality industry."
Simon Bridges, National:
This Government is committed to striking the right balance between protecting our lowest paid workers and ensuring jobs are not lost.
This year's minimum wage increase by 50 cents to $15.75 was expected to benefit about 119,500 workers. Since 2008, the minimum wage has increased from $12.00 an hour to $15.75 an hour - an increase of 31.3 per cent.
Clayton Mitchell, NZ First:
At the last election the biggest driver steering the economy was pay parity between NZ and Australia and there is still a massive gap.
NZ First will introduce a tax package for businesses so people can maintain profitability and increase the living wage to $20 per hour.
We are a low-wage economy and we need to look at that seriously.
Jan Tinetti, Labour:
When 40 per cent of children in poverty live in a working household and two-thirds of workers' pay fell in real terms last year, despite the economy growing, working people are not sharing in economic prosperity.
Labour will boost the minimum wage to $16.50 an hour and base future increases on the real cost of living for people on low incomes.
Emma-Leigh Hodge: Greens
When in government the Greens will phase in the living wage. We will do this by increasing the minimum wage to $17.75 next year, then incrementally raise it to $20.20. At that point we would tie it to 66 per cent of the median wage so living costs are no longer allowed to outstrip wages as they have done.
Stuart Pedersen: Act
Tauranga wages are generally ok but tax is too high - we could soon be working half the week to cover Jacinda's $20 billion bribes. The only sustainable way to lift wages is to lift productivity: produce more or better stuff or provide better service. That is a responsibility of every worker and every business: the state should help by cutting taxes.
Ben Rickard, United Future:
Everyone who works should be paid enough so they can thrive in our region and be a contributing part of our community, instead of having to worry about their financial future.
Tauranga has a lot of low-paying horticulture jobs. We must encourage investment in more high value industry and added value services like tech and support local people to learn the skills needed.
Rusty Kane, Independent:
It is generally accepted the minimum wage, which was recently increased from $15.25 to $15.75, should be boosted to a living wage more in line with the cost of living. A living wage needed for a family to have a decent standard of living in Tauranga is $20.20 an hour. The minimum wage should increase by $5 over three years.
Hugh Robb, independent:
Tax relief addresses minimum wage issues.
I propose adopting a system similar to the UK - GST 25 per cent, eliminating income tax on first $32K (rising to the median wage).
The result: 8.5 per cent price increase, zero increase in rent/mortgages and 25 per cent increase in take-home pay on first $32K.
Half of earners will be about 20 per cent better off.
Yvette Lamare, independent:
The average rent these days is $400 a week. People are paying mortgages. An increase on minimum wage would be appreciated as your whole weekly wage may not even cover your weekly rent, mortgage, let alone power, phone, groceries and all other living expenses.
Jason Jobsis, Democrats for Social Credit:
Tauranga is growing quickly with more industries and business relocating from Auckland. Unfortunately the average wage is not rising due to the $10 Tauranga mindset. We believe not only wages should rise with the region's growth but should match the inflation of the country. The minimum wage should be around $20.20 to match the increase of living costs.
Joseph Borell, Maori Party:
I think the minimum wage is too low and people would find it difficult to live on. The sooner it gets to $20 an hour, the better. Everything has gone up except the minimum wage. The wages have got to keep in tune with the rest of the economy.
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