Minimum wage increase a mixed bag

Prime Minister Chris Hipkins announced last week that the adult minimum wage will be rising to $22.70 per hour.

But a snap poll from Retail NZ shows business leaders aren’t happy with the increase, with 88 per cent disapproving of the Government decision.

A Retail NZ spokesman says the “significant increase” has not gone down well with retailers.

“Many small business owners do not even earn Minimum Wage out of their own businesses and are now faced with yet another big hike in their wage bill.

“Retailers have told us the real impact this increase will have, with 69 per cent saying they will increase prices as a result, 57 per cent reducing the hours of work available to their teams and 41 per cent planning to reduce staff numbers. In a statement, the Prime Minister says the government is refocusing its priorities to put the costof-living front and centre.

“In tough times, it’s critical to support those who struggle the most to make ends meet,” he says. “We’ve tried to find the right balance. Analysis from MBIE that fed into our decision suggests this increase is unlikely to have a significant impact on unemployment, because it is broadly in line with existing average wage growth across the economy.”

The government will review the minimum wage rate again later this year.