WAGE GROWTH At a Glance

Published: 5 November 2007

Description

This report examines the wage growth measures for the September 2007 quarter from the Labour Cost Index and Quarterly Employment Survey, which were released by Statistics New Zealand on 5 November 2007.

Link to full report

Wage Growth HTML | PDF [138 KB, 9 pages]

Summary

Latest figures show wage growth eased slightly but remained high in the September 2007 quarter.

For more than two years, annual wage growth in the adjusted Labour Cost Index has remained at or above 3.0%.

Although some of the main wage growth measures have eased, the easing was small and other wage indicators stayed high.

Wage growth in real terms was higher than recent quarters, mainly as a result of a fall in inflation, suggesting there has been a strong increase in the purchasing power of workers’ earnings.

Key results from the Labour Cost Index and Quarterly Employment Survey are shown in the table below.

Recent wage growth results

Wage Growth	Last year	Last quarter	This quarter
(annual % change)	September 2006	June 2007	September 2007
Adjusted LCI	3.2	3.2	3.1
Unadjusted LCI	5.1	4.6	4.8
QES	5.1	4.2	3.9

Source: Statistics New Zealand.

Looking Forward

Strong wage growth is likely to continue in the year ahead given the very low unemployment rate and the demand for labour remaining high.  Furthermore, employers are continuing to report significant difficulty finding both skilled and unskilled labour.  Nevertheless, some minor easing is expected as a result of the fall in consumer price inflation over the last year.

Related information

Labour Cost Index data from Statistics New Zealand [external link]

Quarterly Employment Survey data from Statistics New Zealand [external link]

Future updates

This is a regular report – the next update is due in February 2008.  Reports from previous periods can be found in archive

Author or contact details

For further information please contact the Labour Market Analysis team