New Zealand Raises Adult Minimum Wage to $14 Per Hour Starting April 1.
By Caroline Ameh
In a recent announcement by Workplace Relations and Safety Minister Brooke Van Velden, New Zealand’s adult minimum wage is set to increase by 2%, reaching 23.15 NZ dollars (14.12 U.S. dollars) per hour, effective April 1. Van Velden emphasized the government’s commitment to finding a delicate balance between safeguarding the incomes of the lowest-paid workers and maintaining favorable labor market conditions.
Acknowledging the evolving economic landscape, Van Velden highlighted the government’s cautious approach this year due to changes in factors such as high net migration rates, constrained consumer spending, and subdued economic growth. Despite the current low unemployment rate, there are signs of a softening labor market.
One notable aspect is the minimum wage’s ratio to the median wage, which has risen from 62% in June 2017 to 72% in June 2023. While this adjustment aims to support low-income workers, Van Velden acknowledged the potential challenges for businesses in issuing pay raises or hiring additional staff.
The opposition Labor Party criticized the minimum wage increase as “tiny,” questioning its effectiveness in addressing economic disparities. Van Velden defended the decision, noting that the increase considered current economic conditions and aimed to rectify distortions caused by historically large minimum wage hikes.
Despite the rise in the adult minimum wage, training wages and starting wages will remain at 80% of the adult minimum wage rate. The government remains focused on balancing economic considerations with the well-being of both workers and businesses.
