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Minimum wage earners get 50 cent pay rise

NZ Newswire logoNZ Newswire 24/01/2017 Sean Martin

Minimum wage earners will have an extra 50 cents per hour going into their pay packets from April.

The annual raise, from April 1, will take the hourly rate to $15.75 an hour.

The 3.3 per cent increase will over time strike the right balance between increasing the incomes of those in secure employment and helping the unemployed to find jobs, Prime Minister Bill English says.

The increase could put up to 1500 jobs into question, but Mr English says in the context of an economy creating hundreds of thousands of jobs over two or three years that's not a large number.

"But you do have to keep it in mind," he said.

"You can see the logic that the wages keep going up you get some sort of substitution of kiosks or whatever for people, and that's why we talk about the balance here, trying to get the balance."

Increasing the minimum wage also makes working seem worthwhile and more attractive to those on welfare, he said.

But Labour MP Iain Lees-Galloway said the 50 cent increase isn't enough to keep up with the increasing cost of housing.

"A 3.3 per cent increase in wages is nothing when rents went up by 5.8 per cent last year and house prices rose by 12.5 per cent," he said.

He said far too many New Zealanders were on the minimum wage and reliant on the government for pay rises.

About 120,000 minimum wage earners will receive the increased wage.

The starting-out and training hourly wage will also rise, from $12.20 to $12.60 per hour.

It remains at 80 per cent of the adult minimum wage.

While welcoming the latest increase, the Council of Trade Unions wants to see the minimum wage calculation changed to make it two-thirds of the average wage.

This would take it to $19.88 per hour.

"A 50 cent increase is certainly a step in the right direction but with small steps like this it will take a very long time to achieve a fairer New Zealand; the New Zealand which working people are telling us they need," CTU president Richard Wagstaff said.

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