INCREASING REAL WAGES

Press, Volume LXXXIX, Issue 27203, 21 November 1953, Page 8

INCREASING REAL WAGES

Productivity Most

Effective

COOPERATION HELD INDISPENSABLE

“The maintenance and improvement of living standards of the people depend ultimately upon the level and growth of productivity. The most effective way to increase real wages is to increase productivity,” says the Arbitration Court in its decision on the general wage order. “While it is true tnat primary responsibility for action to increase productivity in individual undertakings rests with employers and their executives, the active co-opera-tion of workers and their leaders is indispensable. Not only can increased productivity raise the general standard of living almost immediately, but it can also provide the additional capital equipment which is necessary to ensure continuing advancement in the standard in future years.” When higher national productivity was achieved, workers as a whole should share in the benefits arising therefrom. The Court fully recognised the degree of its responsibility in that direction, and appreciated too that the wholehearted co-operation of organised labour must be founded on a broad confidence that the benefits of increased productivity would be fairly and equitably distributed among the different sections of the community. “It should be remembered, however, that an increase in wages is not the only form by which the benefits of higher productivity have been or may in the future be distributed to workers. Shorter hours, longer annual holidays, rest periods during working hours, better working conditions, and improved social services, all benefit the worker, and all involve a charge against increased productivity. “Another form of benefit to workers which could arise from increased productivity is a reduction in the prices of consumer goods. While over-all production a head in New Zealand has advanced during the last five years, there has been no sign that any appreciable portion of the benefit has been shared with workers by way of a reduction in the prices of . consumer goods.” Maximum Not Determined

It should also be remembered that the function of the Court was to determine minimum rates of remuneration. It was not its function to determine tne maximum rates wmch industry as a whole could afford to pay. Therefore, in taking intc account increases in the volume and value of production in primary and secondary industries in New Zealand, the Court considered that some traction of such increases must necessarily be leit for distribution through enhanced wages arising from competition amongst industries and employers for efficient labour, through incentive schemes to encourage increased productivity in individual establishments, and through improved working conditions. For the first time there appeared in the Economic Stabilisation Regulations a specific direction that in making a general order the Court should take into account “any increase or decrease in the volume and value of production in primary atad secondary industries of New Zealand.” In the past it had been the practice of the Court to pay some attention to the changes in the volume and value of production when considering the economic conditions affecting finance, trade, and industry. “We take it the intention of the recent change in the regulations is that greater attention is to be devoted to this aspect of the national economy when general adjustments to the wage structure are under consideration. It seems to be indicated that more explicit recognition is to be given to the rates of increase or decrease in the volume and value of production as factors which should influence minimum

rates of remuneration. This development should tend to focus the attention of workers and employers to a greater extent than in the past upon the overwhelming importance of higher productivity.”