Higher Wages Worth Voting For

Higher wages: worth voting for

New Zealand can achieve a high wage, high skill and highly productive economy.

The best way to get there is through rising real wages, a decent minimum wage, collective bargaining and higher productivity.

Productivity is rising but real wages are not. Structural changes are needed to break out of the low wage rut.

The Labour government has been moving in the right direction, setting a positive example in the public sector.

But National is offering a quick fix of large tax cuts — and wages stuck on “low” into the long term. But tax cuts are no substitute for
wage increases.

Without higher wages, there is no incentive for employees to work smarter or for employers to invest in technology and training.

The CTU has a six-point plan to break the mould and propel all New Zealanders toward a more prosperous future.

Increase the minimum wage to at least $15ph
Lifting the minimum wage won’t cost jobs as National claims because demand for labour is still strong. In fact, when the minimum wage for 16 and 17 year olds rose by 41 percent over two years, these young people went out and worked more hours.

More collective bargaining
For historic reasons, employers fear collective bargaining – yet without it, New Zealand can’t move out of the low wage-low skill trap.

Employers know they need industry strategies for export promotion, skills development and innovation. But they are slow to realise the benefits of industry bargaining.

Industry bargaining is widespread in Australia. We need it here. And it needs to be bargaining based on democratic union processes – not a non-union bargaining model to undermine collective worker rights.

Build union capacity
The low paid are hit hard when unions can’t function effectively. Support for unions could include more research, expanded mediation services, funding for bargaining initiatives, and advocacy training.

“Good employer” and “responsible contractor” policies in the state sector
The state contracts out some huge chunks of work, for example in disability support and elderly care, but pay rates can be dismal. The government needs to encourage employers who invest in training, offer secure employment and don’t have a record of unjustified dismissals.

Increased productivity
In Australia, productivity rose faster in the 1990s because wages rose and businesses invested in technology. In New Zealand, employers stuck with cheap labour and old equipment. And many failed to invest in training.

Despite this since 1988, labour productivity in New Zealand has increased by around 42 percent — yet real wages have barely moved.

Workers will not give their best efforts to increase  productivity if all the benefits are kept by employers, including foreign owners of New Zealand firms. We need more capital, more training and better workplace relations.

Close the gender gap
Women earn around 87 percent of what men earn. Women are more likely to be in low paid work, and in jobs where skills are not recognised or undervalued.

Collective bargaining is an important tool in reducing the gender pay gap.