The biggest increase in the history of the minimum wage will have a huge impact for workers on low wages, says the New Zealand Council of Trade Unions.
From tomorrow, the minimum wage will rise to $22.70, up from $21.20. This increase will benefit 223,000 people and lift the incomes of the lowest paid workers across New Zealand by around $350m a year.
NZCTU President Richard Wagstaff said a worker on 40 hours a week would benefit by $3,078 a year – or $59 a week.
“The minimum wage has increased around the same rate as inflation at 7%. This will mean our lowest income families and communities will be better protected from the cost-of-living crisis.”
Wagstaff said raising the minimum wage was a far more effective policy than cutting taxes.
“This increase is 27 times more than a minimum wage worker would get from National’s proposed tax cut of $2.15 a week.
“Our best economic evidence also shows that increases to the minimum wage do not contribute to higher inflation or unemployment. Credible estimates put the likely increase in inflation from the minimum wage lift at around 0.1% – effectively zero.
“This is simply good policy. We have huge numbers of working poor in New Zealand whose lives will be made easier by this change.”