The 2018 New Zealand Living Wage rate is $20.55 an hour – 35 cents more than the 2017 rate and the smallest annual Living Wage increase since it was first launched in 2013.
The new rate was announced today by Wellington Mayor, Justin Lester at a gathering of Living Wage Employers, faith and community groups, and unions at Wellington bar and Living Wage Employer, The Rogue and Vagabond. Local and national politicians also attended.
In previous years, the Living Wage has been reset annually according to wage inflation to June of the previous year.
However, this year’s rate is different. It has been subject to a review of the goods and services on which the calculation is based to ensure it remains realistic and robust. The review draws on the Household Economic Survey data used to strike the original rate, as well as new data sources which detail essential family needs, as well as expenses including energy, health, communication and education costs.
“This is a big year for the Living Wage Movement because the new rate follows a full review which includes many more databases and closely reflects what workers need to survive and participate in society,” says Annie Newman, Convenor of Living Wage Movement Aotearoa New Zealand.
The new rate also takes account of the significant increases for families with dependent children because of the Government’s Families Package. Without the package, the rate would have been $22.45 – a difference of nearly $2.00 an hour.
“The increase is the smallest since the first Living Wage rate was announced because, while costs have increased markedly, the Families Package has softened the impact on households,” says Annie.
“Nearly 683,000 workers earn less than a Living Wage and there is a 24.5 percent difference between the minimum wage and the Living Wage, so we know people are struggling out there.
“There are now close to 100 Accredited Living Wage Employers and any employer who steps up as part of our voluntary programme is going to transform the lives of their workers,” she says.
The 2018 rate takes effect on 1 September although it’s expected some Living Wage employers will move immediately to lift the wages of their staff.
