New Zealand’s wage inflation rises 2.1% in the year-to-June quarter
Wage inflation in New Zealand rose 2.1% in the year-to-June 2021 quarter, while average ordinary hourly earnings increased by 4%, according to Stats NZ.
The labour cost index (LCI) of all salary and wages, including overtime pay, increased by 2.1%, showing an increase of 1.6% in the year-to-March 2021 quarter.
“The LCI captures reasons why employers change their pay. This quarter, a lot of firms reported trying to match market rates and retain staff in a tight labour market. This, combined with the rise in minimum wage in April, helped drive wage inflation this quarter,” said business prices delivery manager Bryan Downes.
“Over half the roles surveyed in the LCI saw an increase to wage rates in the year to the June 2021 quarter – the first time this has happened since the June 2020 quarter,” he added.
Wages in the construction industry have also risen over the year, rising 3% in the year-to-June 2021 quarter.
The LCI measures movements in wages employers pay to have the same work done to a set standard, according to Stats NZ. The index controls for any changes in the type or amount of work, person doing the job, or even change in qualification or experience, it states.