The labour demographics of a NZ living wage

Distribution of families earning below the Living Wage

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Source: Taxwell

The wage rates of people of different ages

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Source: Taxwell

The distribution of wages by industry

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Non-wage earners is mainly self employed. Source: Taxwell

NZ’s proposed Living Wage compared to other Living Wage proposals

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Source: Living Wage campaign websites, and exchange rates as at 20 September 2013

  1. 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).
      1. 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.
      2. 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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