Distribution of families earning below the Living Wage
Source: Taxwell
The wage rates of people of different ages
Source: Taxwell
The distribution of wages by industry
Non-wage earners is mainly self employed. Source: Taxwell
NZ’s proposed Living Wage compared to other Living Wage proposals
Source: Living Wage campaign websites, and exchange rates as at 20 September 2013
- The Living Wage proposal is an ineffective way to help families with low incomes, because:
- Many low income earners are people below the age of 30 who are single or part of a childless couple;
- The extra earnings by parents would result in reduced tax credits or benefit payments (as they abate with higher income).
- If adopted as a minimum wage, New Zealand would be out of line with other countries, and it is likely to reduce employment, particularly of younger people trying to enter the labour market.
- The overall impact on poverty levels is likely to be small, but it would represent a change of focus from supporting families with children towards supporting young, single people.
General source: The Treasury Living Wage Information Release
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