Rate of salary increases dips

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The rate of salary increases in New Zealand has slowed, according to a survey by Mercer.

The rate of salary increases dipped to 2.5 per cent at February 2011 from a peak of 5.2 per cent in early 2009.

Mercer's Market Issues Survey examines pay trends at 91 organisations.

Mercer does not expect salaries to go any higher next year.

The slower rate of pay increase in New Zealand comes at a time of debate about lower pay rates in New Zealand compared to Australia.

"Kiwis are still coming to terms with the impact of the recession on their businesses, any cautious optimism about the economy has been tempered by the impact of the Christchurch earthquakes, and organisations will continue to target their spending to focus on growth," said Sarah Barnaby, senior associate in Mercer's Information Product Solutions business.

"This does not leave much scope for passing on substantial pay increases to everyone," she said.

Salary movements in Wellington have increased from 2 percent to 2.5 per cent.

- NZPA