Bad luck: Pay rises probably off the table until next election

If you're hoping for a pay rise sometime in the next four years, you might be out luck.

It's unlikely because the economy won't provide any growth to drive wages up.

The official forecast predicts wages will not keep pace with inflation, and immigration may be to blame.

Lorne Tito works in the concrete industry and earns what we call the average wage.

He was given a payrise of 50 cents an hour last year, his first in six years. Things have got so tough that his wife has had to go back to full time work for them to make ends meet.

He's hoping for a payrise to ease the stress, but Treasury says don't get your hopes up.

Treasury forecasts show wages are expected to go up like this at over 2 percent, but inflation is also going up, meaning prices are going up at the same rate.

That means what's called "real wage growth" is actually flat.

Financial commentator Bernard Hickey says that means more Kiwis will be stuck treading water.

But the Finance Minister argues that Treasury figures are "conservative".

The economy is growing. Over the next four years Treasury predicts there will be an extra 215,000 jobs created.

But over that same period Treasury is also forecasting a net migration of 212,000 - meaning nearly as many immigrants will come in as there are jobs created.

Mr Tito says the politicians better get their act together if they want his vote.

There is still some hope for workers wanting a payrise, with next week's pre-election opening of the Government's books.

That will give more insight into where Treasury thinks wages are heading.

Newshub.

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