Wage rises to top inflation

New Zealand pay rates are tipped to rise 3.8 per cent next year, outpacing inflation by 1 percentage point, a worldwide pay survey shows.

The Mercer Human Resource Consulting's 2006 survey says this lags behind a forecast average global rise of 2.4 percentage points above inflation. Average Australian pay rates are forecast to rise 4.2 per cent next year, against expected inflation of 2.8 per cent.

Rob Knox, head of information services for Mercer Australia and New Zealand, said while projected pay increases were modest on both sides of the Tasman, the economic climate in both countries was one of upward pressure on inflation, low unemployment and higher voluntary staff turnover.

"These ingredients are likely to contribute to wage pressures which, in turn, will require organisations to manage pay budgets judiciously to ensure the retention of key talent and high performers," he said. Pay rates in Britain are tipped to rise by 1.5 percentage points above inflation, while the United States should see pay increases of 1 percentage points above inflation.

- NZPA