The Bottom Line.

A minimum wage increase is multi-million dollar equation  

By Kate Pierson

Although we may not openly articulate the fact, many of us believe we are of more value to our employers than they give us credit for – financially speaking.
Perhaps we’re right, or perhaps our professional egos are slightly inflated. Nevertheless, wage bargaining, salary reviews, pay rises and unfortunately pay cuts are all part and parcel of being employed.
But beyond the usual challenges involved with work and pay, adding fuel to the employment fire at present, is the – ‘to raise or not to raise the minimum wage’ debate. And in context of what a wage increase could cost our employers and economy, it really is the multi-million dollar question.

Balancing act 
While they may be lobbying on opposite sides of the finance fence, New Zealand’s pro and anti minimum wage increase campaigners are working towards the same cause- protecting employees. Yet each is determined to achieve this result through contrasting methodologies.

ACT MP Sir Roger Douglas says we only need to look at the skyrocketing figures in youth unemployment since the abolition of youth rates in early 2008, to see the domino affect that occurs when employers are put under financial strain with wage payment.
“Since youth rates were abolished in early 2008, the unemployment rate for 15-19 year olds has almost doubled.”

Maintaining that there is a balancing act to be drawn, Business New Zealand chief executive Phill
O’Reilly reasons that if the minimum wage is too high it creates a concertina effect.
“An excessive minimum wage denies young people the opportunity to get a job, as employers cannot afford to hire them. When unemployed, they can’t gain work experience, don’t receive job training and never develop a work ethic,” he says.

With an average hourly wage of $22.96 in New Zealand, O’Reilly says there is no denying many are earning less than this but that people earning minimum wage are an exception as opposed to the rule.
“Most are not on the minimum wage for long. Minimum wage earners are generally those who are episodically in the workforce or unskilled at first.” O’Reilly says it is also important to take into consideration the social protection low wage earners are afforded in New Zealand.

Pay up
On the pro pay increase side of the spectrum, thousands are saying it loud and proud – ‘pay up’. Using protests, petitions and pickets, they won’t be silenced by the critics and one of the strongest voices of all belongs to Living Wage.

The Living Wage campaign established by Unite Union is led by organiser Joe Carolan and attests
that New Zealand’s overwhelming support for an increase in the minimum wage is palpable.
“The New Zealand Herald poll last month that found that 61 percent of New Zealand support raising the minimum wage… underestimates the support we are getting from thousands of people every week,” Carolan says.

Beyond securing an increased minimum wage for youth, Living Wage is advocating for adults who fall into the minimum wage category.
“The working poor are not stupid and if the Government continues to attack us (Unite Union), National MP’s shouldn’t be surprised they’ll be targeted for public shaming and ridicule in their local communities.”

The Maori, Green and Labour parties have also leant their voices to this cause and Labour MP Trevor Mallard and Maori MP Dr Pita Sharples have both spoken out in their support of a minimum wage increase. “We believe an increase to $15 per hour could be phased in incrementally if necessary, to provide immediate relief, along with the promise of a brighter future,” Dr Sharples has said.

With headlines fueled by fervent oppositional debate circulating in our media midst, it seems everyone is willing to put their two cents in when it comes to the minimum wage controversy.
But as we continue to watch wage increase activists cashing in on the media spotlight, whether their vocal demands actually buy a wage increase from the government, still remains to be seen.


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