The government’s decision to slightly raise the minimum wage has received positive feedback from retailers and manufacturers.

Starting April, the country’s minimum wage will increase by 1.5 per cent to $23.50 an hour, which Retail NZ CEO Carolyn Young described as an “early Christmas present” for retailers and a relief during challenging economic times.

“Every cost increase has to be passed on to consumers so we are pleased the Government has limited the adult minimum wage rate increase to 1.5 per cent,” Young said.

“Making the announcement at this time also gives employers time to plan their staff needs for next year,” she added.

Alan McDonald, head of advocacy at the Employers and Manufacturers Association (EMA), also expressed support for the decision, saying it reflects the current economic climate and labour market conditions. 

“New Zealand currently has a relatively high minimum wage compared with other key OECD countries.

“This modest minimum wage increase is a sensible response to the state of the economy and will result in more Kiwis getting into jobs and learning the skills they need to build rewarding careers,” McDonald elaborated.

He added that the EMA will continue to advocate for a more predictable and stable approach, such as an index-linked method, to future wage increases.

Aside from the minimum wage increase, the government has also announced changes to the Accredited Employer Work Visa, including the removal of the median wage requirement.

According to Young, the need to pay median wage has been a barrier for retailers who need to hire migrants for lower skilled roles.