Labour Party leader David Shearer wants to set a "living wage" to help raise incomes.
In a speech at Nelson on Thursday, he outlined Labour's ideas on how to improve living standards, highlighting the success of the Living Wage initiative in London - a basic wage worked out each year and introduced by employers on a voluntary basis.
Mr Shearer says there will be no legal requirement for people to be paid the living wage but a Labour-led Government would continue to raise the statutory minimum wage.
"It's not legislated. The living wage rate is set, and then government departments - as their budgets allow - would work towards meeting that living wage.
"They would also require anybody who was contracting to that government department to be paying a living wage. People who are paid well actually turn out to be more productive, have less absenteeism and to stay in their jobs longer."
London's living wage - introduced by employers introduce it on a voluntary basis - has lifted productivity and lowered staff turnover, and might be worth considering in New Zealand, Mr Shearer says.
He also confirmed under Labour, employers would be paid a subsidy - the equivalent of the unemployment benefit - to take on young apprentices in an effort to get all young people into work or training.
As well, he says Labour would focus more on education and research and development to promote economic growth.
The speech to the Nelson Chamber of Commerce was the second of what Mr Shearer calls his "scene-setter speeches" laying out Labour's broad policy direction under his leadership.
In his first speech earlier this year, he talked about how to make the economy grow faster.
