Construction wage growth in Canterbury is considerably higher. Photo by Linda Robertson.
Construction wage growth continues to be substantially higher
in Canterbury than the rest of the country but there is
little evidence that industry skill shortages are pushing
wages higher nationally.
Statistics New Zealand figures released yesterday showed that
the mean wage increase in the Canterbury construction sector
in the year ending September was 6.8%, down slightly from
6.9% in the June year.
Nationally, construction wage growth was unchanged at 3.9%.
According to Statistic NZ's labour cost index (LCI), overall
wage inflation in the construction sector remained stable and
only a little above average at 2.3%.
LCI private sector, ordinary time, wages rose 0.5% in the
September quarter to give an annual increase of 2.1%. All
sectors, ordinary time rose 0.5% in the quarter and 1.9%
Public-sector wage growth was lower than the private sector.
The LCI and quarterly employment survey (QES) came in close
to expectations, showing moderate rates of wage and
Wage growth measured by the QES rose 2.8% across all sectors
but full-time employment growth and hours paid were notably
ASB economist Daniel Smith said the Canterbury rebuilding
work was expected to place some upward pressure on labour
costs and wages in the coming year as skill shortages
emerged. But there was little evidence of that effect on a
sustained or nationwide basis so far.
Employment indicators in the QES were particularly weak in
the latest quarter, but that followed three months of
outsized strength so some reversion was not unexpected, he
The QES had not been a good indicator of employment and
unemployment data recently.
The latest QES data confirmed ASB's expectation of modest
employment growth in the third quarter.
ASB expected tomorrow's household labour force survey - the
official measure of employment and unemployment - to show
employment growth of 0.3%, with the participation rate
remaining unchanged. The slight increase in employment should
outstrip growth in the labour force, taking the unemployment
rate down from 6.9% to 6.6%.
"Today's data largely confirmed what we expected. The
moderate rate of wage and employment growth continued over
the third quarter. Wage growth has been very stable for the
last couple of years, with the LCI increasing by about 2%
year-on-year," Mr Smith said.
Council of Trade Unions economist Bill Rosenberg said that
with many people still finding times tough, it was important
that wage increases ensured people had a living wage.
"Nothing has been heard from the Government on the minimum
wage review, which would usually have finished its public
consultation process by now. We hope they are not planning to
slow increases for those who need them most"
The minimum wage increase flowed on to many people on low
wages, he said.
The statistics also showed an opening of gaps. The LCI showed
wages and salaries for central government employees rose only
1.3% for the year compared with 2.1% in the private sector.
The average wage also showed an opening in the gender pay gap
from a 12.6% gap in September last year to a 13.9% gap in
September 2012, he said.
Increases in the female average wage were 4.8% over the last
two years compared for 6.9% for men -widening the pay gap, Mr