Award rises likely to get smaller

Press, 27 March 1980, Page 3

Award rises likely to get smaller

PA Wellington Lower increases in award rates during the 1980-81 round of wage negotiations are forecast by the Institute of Economic Research. In its latest quarterly predictions on national income and expenditure,, the institute says minimum wage rates increased by about 15 per cent in the year ended March, 1980, but actual wages when other factors, including overtime, are taken into account went up 16.5 per cent. “Over the next 12 months, however, we expect the demand for labour to weaken so that actual earnings are more likely to move closer to award rate movements,” the report says. “Because of weak demand and an expected lower rate of price inflation over the next year, we have assumed that the 1980-81. wage round will result in a lower increase in award rates.” The institute maintains a previous assessment that salary and wage rates will increase about 17 per cent on an annual basis during the first half of 1980-81 but moderate to about 14 per! cent during the wage round. It assumes a fall in total. employment, including time worked, or about 0.51 per cent and forecasts a 15 per cent growth in compensation to employees during I the year.