Employers say wage earners better off

Press, 13 November 1981, Page 4

Employers say wage earners better off

PA Wellington The latest nominal wage index established that wages were leading prices, and that wages paid by the State were leading those paid by the private sector, said the executive director of the Employers’ Federation, Mr J. W. Rowe, yesterday. He said that wage and salary earners were improving their standard of living at the expense of the unemployed. and self-employed, and those on fixed incomes.

“With the sloW-growth economy, the national cake is not getting much bigger, but the share of the cake taken by wage and salary earners is.” said Mr Rowe. “This means that there is less money available for investment in job-creating areas, and in areas of new or increased production. “The latest wage index figures are a product of the wage explosion which followed the 4 per cent Budget allowance in August. 1980. and 13.5 plus per cent

wage round last year, and the Arbitration Court's 5 per cent cost-of-living increase order in June this year,” Mr Rowe said. The Federation of Labour’s economist. Mr Alfred Kirk, said yesterday that the figures did not indicate that people were better off. Mr Kirk said the figures did not show that wage earners were keeping ahead of inflation because the wage-movement figures were based on gross income and did not take into account the effect tax had on takehome pay. He said the figures did not take into account the latest wage round where awards were providing for an increase of about 10 per cent. He said that with inflation in the coming year running at between 15 and 20 per cent, and with the wage round running at just 10 per cent, wage earners would be falling behind substantially by the middle of next year.