WAGE ADJUSTMENT

Grey River Argus, 16 July 1940, Page 8

WAGE ADJUSTMENT

TO COST OF LIVING Employers Oppose Increase THE PAINTERS’ CASE. [Per Press Association] WELLINGTON, July 15. Mr D. I. MacDonald opened tne employers’ case, in the application oy the New Zealand Painters’ and Decorators’ Federation, in the Arbitration Court, for a general order to fix wages in industry. At the outset he emphasised that the resolution of the April, conference, between representatives of tne employers and workers, recommending as a tdTnporary measure for the duration of the war and six months, to authorise the Court to amend the wages provision, must not be taken as recognition by the employers that there was any justification for increasing the wage rates. The resolution merely recognised the possibility or necessity of increasing or decreasing wages by general order. Mr MacDonald emphasised New Zealand’s dependance on primary production. He put in statistics, showing th e relationship of wages to added value in factory production. He said that the factory added value figures did not take into account costs incurred in the production of raw materials, or in the distribution of the finished product. If these additional costs were included ’ tne seriousnes s of the cumulated effect of a general increase in wages on costs and prices would be appreciated. Past experience had shown that the vicious pile of rising prices resulted from increasing wages rates, in accordance with th e cost of living figures. The workers’ request was based only on the cost of living, but the Court must take into account also economic and financial conditions affecting trade and industry, and alt other considerations the Court deemed relevant. Evidence as to economic and financial conditions in New Zealand was given by Professor A. H. Tocker, Dean of the Faculty of Commerce and Economics at Canterbury University College, who was the first witness for the employers. Professor Tocker said that the adjustment of wages to rising prices in war-tim e increased internal costs, both of production and of Government. Hampered production increased the difficulties of war finance, raised the cost of living, led to applications for further wage adjustments, ana started moving the vicious spiral of costs and prices, which was the commonest cause of inflation. Inflation wa s always disastrous, particularly tn wage-earners. If the facts of the pconomic situation are recognised, and the necessity for some sacrifice in living standards was admitted and accepted by all, the danger of inflation might be avoided, and the difficulties of adjustment to war organisation and war finance greatly diminished.