Radio New Zealand - Te Reo Irirangi o Aotearoa

Unions label minimum wage rise 'inadequate'

Updated at 9:36 am on 8 February 2011

Unions representing low income earners say a 25 cents an hour increase in the minimum wage is pathetic.

The Government has decided workers should be paid at least $13 an hour.

It says it has tried to strike a balance between lifting wages and ensuring businesses can manage any increase.

But Council of Trade Unions economist Bill Rosenberg says the rise is totally inadequate and well behind inflation.

He says a more appropriate minimum wage would be $15 an hour.

The Chamber of Commerce in Auckland says the increase to $13 will lead to a rise across the board.

Chairman Michael Barnett says the Government has struck the balance it was trying to achieve.

He says a more significant rise would have put pressure on employers because it would need to be applied across the entire workforce to maintain relativity.

Lincoln University economics professor Paul Dalziel says workers being paid the minimum wage will start to fall behind as long as the increase equates to less than the rate of inflation.

He says while the country is experiencing a recession it makes sense for the Government not to push things but once things improve that should change.

Listen to Paul Dalziel on Morning Report

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