Wage rises highest in 14 years says study

Wage rises in the last 12 months were higher than at any stage in the past 14 years but low given the health of the economy, a university survey shows.

The Victoria University industrial relations centre survey also found that people on low wages were getting smaller percentage pay rises.

Workers on the lowest wages contained in collective agreements had an average increase of just $12 (2.5 per cent) a week for the year to June 2005 - and of just more than $10 a week a year for the last 14 years, said Professor Geoff Lafferty.

Several industries had their lowest wages increase by less than $1 each year for the past 14 years, Lafferty said.

The average pay rise for all workers in the year to June was 2.8 per cent, the largest for workers on collective agreements for the past 14 years. The average during the past 14 years was 2.2 per cent.

Lafferty, professor of human resource management and industrial relations at Victoria, said wage increases during 2000-2005 was more rapid than the previous five years.

"However, increases are modest considering historically low unemployment, high economic growth and greater demand for skilled labour. And not all New Zealand workers are enjoying better pay."

The survey also showed that more than 300 collective contracts contained wage rates below the new legal minimum wage rate of $9.50 an hour.

However, Engineering, Printing and Manufacturing Union spokesman Andrew Little said this did not mean workers were necessarily being paid below minimum wage rates.

"The $9.50 rate did not come into effect until March 1 and many of the collective agreements currently in place would have been finalised before then," he said. "As soon as the $9.50 rate came into force it overrides the agreement below that rate in the contract and employers are required to pay it.

"In an ideal world the contracts would have been updated after March 1 to take account of the new rate but in reality it doesn't always happen."

Little said the survey results were in line with the EPMU's figures.

"Our largest multi-employer rise was 10.9 per cent and the average 3 per cent," he said.

"In a time when the economy has been going so well it highlights why we are running the 5 per cent increase campaign."

Lafferty also said there was reason to be concerned about people saving for retirement.

"There is a low rate of superannuation arrangements with 57 per cent of workers covered by collective employment agreements having no superannuation provision," he said.

Only 12 per cent of the private sector employers made contributions to workers' super schemes, and these payments ranged from $1.20 to $89 a week. Little said many workers felt they were not earning enough to invest in superannuation.

The industrial relations centre will have seminars on the survey in Dunedin, Christchurch, Hamilton and Auckland over the next two weeks.

- NZPA