Come April and the minimum wage in New Zealand will be hiked by NZ$ 1.5.
That means, the hourly wage with effect from April 2023 will be NZ$ 22.7.
The increment has been implemented basis the Consumer Price Index (CPI) and was announced by Prime Minister Chris Hipkins recently. The measure is an attempt to lend support to those who are grappling with rising costs and low incomes amidst the rising inflation rate, which is reported to have touched 7.2 per cent end of last year, that is, December 2022.
It is hoped that this hike, which takes into account the inflation, will prevent thousands of citizens from slipping into allowing their living conditions to deteriorate. The ‘Starting-Out and Training’ minimum wage rates will continue to be 80 per cent of the adult minimum wage.
While there were fears that a rise in minimum wage may end up increasing unemployment, it is now felt that since it aligns with the average wage growth across the economy, there will not be much of an effect on unemployment.
An increase of seven per cent in the minimum wage will reportedly result in only a very slight inflationary effect of 0.1 per cent on the chunk formed by wages in the gross domestic product.
Many other governmental initiatives and programmes have been put on the back burner or withdrawn altogether so that attention is given to the cost of living alone.
