Annual wage growth at 1.6 percent

Salary and wage rates, which include overtime, grew 1.6 percent in the year to the June 2010 quarter, Statistics New Zealand said today.

This follows an increase of 1.5 percent in the year to the March 2010 quarter. Annual labour cost index (LCI) wage growth had been declining, from a peak of 4.0 percent in the year to the September 2008 quarter.

Salary and wage rates increased for both the public sector (up 2.1 percent) and private sector (up 1.5 percent) during the year to the June 2010 quarter.

Salary and wage rates rose 0.4 percent in the June 2010 quarter. Public sector salary and wage rates rose 0.2 percent while private sector rates rose 0.5 percent. The public sector rise is the lowest since a matching 0.2 percent rise in the June 1999 quarter.

The Quarterly Employment Survey (QES), also released today, showed that total paid hours increased 2.5 percent for the June 2010 year. This is the first annual increase in total paid hours after six consecutive quarters of annual decline.

Average total hourly earnings increased 2.1 percent for the June 2010 year. This follows an identical result in the year to March 2010, which had been the lowest annual increase in average total hourly earnings since the same increase in the December 2004 year.

In the seasonally adjusted series, total gross earnings rose 1.8 percent for the June 2010 quarter, while seasonally adjusted total paid hours rose 1.2 percent.

The LCI tracks nearly 6,000 positions and measures changes in pay rates for a fixed quantity and quality of labour.

The QES is designed to measure quarterly estimates of change in, and levels of, average hourly and average weekly (pre-tax) earnings, average weekly paid hours, and the number of filled jobs. QES statistics are derived quarterly from approximately 18,000 surveyed business locations in a range of industries and regions throughout New Zealand.