Source: EMA
The Employers and Manufacturers Association (EMA) says the government’s early decision to deliver a modest 1.5% increase to the adult minimum wage will allow employers time to prepare.
EMA Head of Advocacy Alan McDonald says the increase from $23.15 an hour to $23.50, which will take effect from 1 April 2025, reflects the current economic climate and labour market conditions.
“While we support this modest increase, we continue to advocate for a more predictable and stable approach, such as an index-linked method, to future wage increases,” says McDonald.
“In the past, significant increases have often been announced with little notice and businesses have been left scrambling to adjust their budgets and payroll systems.
“The government’s early announcement of this modest increase will give businesses time to prepare. In the past we’ve seen sharp increases at short notice and that can be an unexpected burden for businesses, especially when they are already grappling with rising costs.
“New Zealand currently has a relatively high minimum wage compared with other key OECD countries.
“At the EMA, we’ve received a record number of calls this year to our Member AdviceLine regarding restructuring and redundancy as businesses have faced significant financial pressures.
“This modest minimum wage increase is a sensible response to the state of the economy and will result in more Kiwis getting into jobs and learning the skills they need to build rewarding careers.”
As part of the government’s announcement, the starting-out and training minimum wage rates are also being adjusted, from $18.52 to $18.80, maintaining 80% of the adult minimum wage.
“We believe this proportionate increase is fair and avoids pricing young people out of job opportunities, as the experience and life skills they gain at the start of their careers are invaluable for their future success,” says McDonald.
