The minimum wage increase will hit consumers in the pocket according to local businesses.
Prime Minister Chris Hipkins announced last month that the minimum wage will increase from 1 April, rising from $21.20 to $22.70 – and increase of $1.50 an hour.
Sealord chief executive Doug Paulin says the big jump mean prices will need to rise as well.
“Sealord pays above minimum wage and expects to continue to do so moving forward, however a large wage increase like this one does mean prices will have to go up.”
Sealord are one of the region’s largest employers, with about 900 employees.
Doug says the company is looking for more efficiencies in production including potential automation to reduce costs where possible.
“Increasing costs always have an impact on businesses and the last 24 months has seen significant cost inflation well in excess of the normal including freight, fuel, food and labour,” Doug says. “All of this has the circular impact of driving up inflation.”
However, Nelson MP Rachel Boyack says the increase of minimum wage has not been identified as a significant inflationary driver to date in Aotearoa.
“Government officials have estimated a seven per cent increase in the minimum wage will have a negligible impact on employment,” Rachel says.
State Cinema director Mark Christensen says their staff are the most valuable asset so it makes sense to look after them.
“Although the cost increases are challenging, we are making savings in other areas and there will be no effect on the range of movies or screening times.”
Mark says prices are periodically adjusted to take account of inflation and direct cost increases from suppliers.
“At this stage we do not see any significant changes as a direct result the effect of this wage increase as applied to our staff. However, if our suppliers increase prices these may have an effect.
“Many of our staff are above the minimum but the implication is that if you raise the minimum there will need to be an adjustment across the board.
“However, the minimum wage rise is supposed to help those on the minimums - if all wage rates rise then it simply translates to higher costs overall and therefore higher prices across the board for everybody (as we are currently seeing in food and grocery prices), and those on the minimums end up no further ahead.”
Rachel says increased wages for the lowest income earners can help support low-paid workers with the cost of living.
“As the local MP, I have pushed for higher wages in our region for a long time, as we have historically had a low-wage region. I will keep working to change this.”
Mark says the country should be looking to reverse the trends of the last 30 years which have led to greater inequality across society.
“The object as a society should be to reduce the differences and promote more equality in wage rates (taking into account employees’ qualifications, experience, and skills of course).”
