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Following on from recruitment firm Hudson’s survey that concluded that six out of 10 workers would leave their current job for a better salary, New Zealand economists remain sceptical that conditions are favourable for pay increases, reports sharechat.co.nz.
Bill Rosenberg, an economist for the Council of Trade Unions told BusinessDesk: “There is still high unemployment by historical standards. So there's a lot more work to be done."
“Labour scarcity should prompt employers to increase wages to attract and keep staff, but this [is] yet to be truly seen outside of Christchurch where construction worker shortages were leading a rise in pay. It's not enough to say you've matched cost of living, it is time for real wage growth now," Mr Rosenberg added.
Last week's Westpac McDermott Miller Employment Confidence Index showed jobseekers had growing optimism when it came to finding a job, reaching the second highest level in the past two years. The New Zealand Institute of Economic Research Quarterly Survey of Business Opinion said that employers were finding labour increasingly hard to find, particularly skilled workers.
According to the Hudson report, these key economic indicators should force employers to raise remuneration. However, Cameron Bagrie, ANZ New Zealand chief economist, commented: "The labour market is starting to have movement but it's still a long way from being red hot. It's a bit of horse before the cart in terms of wage rises, you've got to get the productivity to match before the wage gains."
“While there is a risk of workers migrating in search of better pay packets, increasingly the New Zealand economy held more promise. People want to come here. The economic story here is more robust than anywhere, than in Australia, and we are seeing a turnaround from the exodus we saw."
“Skill shortages were becoming a problem, particularly in construction, and that increased the pressure for wage growth,” Mr Bagrie concluded.