EMA – Minimum wage rise another ‘body blow’ for business

The EMA says the minimum wage increase from $20 per hour to $21.20 per hour from April 1 is another kick in the guts for businesses that are already on their knees.

Chief Executive Brett O’Riley says the impact of COVID-19, disrupted supply chains, the inability to find skilled workers and rising inflation on small business is crippling.

“This has the potential to shut more people out of work than result in people earning more, because business simply can’t afford it,” he says.

“At a time when we’re talking to the Government about extra financial support as a result of COVID-19, it is unbelievable and frankly cruel that it is going ahead with this additional cost.”

Mr O’Riley says it is the burden of the cumulative costs that will break business.

“If you put wages up, prices go up, fuelling inflation. If the Government wanted to do something about rising costs, there were other ways to alleviate the pressure,” he says.

The EMA would rather work with the Government, unions and other business groups on improving productivity, and rapidly increasing skills in the workforce as a pathway to raising wages.

“The only way now for small business to deal with this minimum wage increase is for the Government to provide extra support for sectors struggling in the red setting,” Mr O’Riley says.

The EMA is New Zealand’s largest business service organisation dedicated to helping people and businesses grow. It offers advice, learning, advocacy and support for 7500 businesses as members of the EMA, ExportNZ and The Manufacturers’ Network. The EMA is part of the BusinessNZ Network and its territory spans the upper North Island. The EMA also offers many of its services nationally to member businesses, and through its partners. www.ema.co.nz.