Low-wage workers will today see their pay check increase by 50 cents an hour.
The minimum wage increases from $13 to $13.50 an hour, and the training and new entrants' minimum wage increases from $10.40 to $10.80 an hour.
Labour Minister Kate Wilkinson announced the increase on February 8 saying it equated to about an extra $20 a week for fulltime workers and struck the right balance between protecting low-paid workers and ensuring jobs were not lost.
"The [Labour] Department's analysis suggested that if we put it up to $15 that could result in the loss of 5000 to 6000 jobs,'' she said.
"If you look at the hospitality industry, retail, they're the ones that are most affected by it, and they will just employ less people and not take people on.''
Workers groups welcomed the increase, but at the time of the announcement said 50 cents an hour was not enough.
Opposition parties and unions have called for an increase to $15 an hour, and Council of Trade Unions' secretary Peter Conway said the rise would not go far enough in relieving poverty or inequality.
"Measures of living standards show that many New Zealanders experience hardship on a daily basis and point to the widening gap between rich and poor. This small increase to the minimum wage will not help these groups of New Zealanders in any meaningful way.''
Mr Conway said unions would increasingly bargain for $15 to become a minimum wage in collective contracts.
Service and Food Workers Union national secretary John Ryall said the minimum wage announcement was "a tragic disappointment for hard working families on the lowest rates''.
"Many of our members will remain below the minimum wage, even though they are performing vitally important roles, providing care for some of the most vulnerable New Zealanders. The fact is $13.50, or $14 an hour, is not a living wage,'' Mr Ryall said.
- APNZBy Hana Garrett-Walker Email Hana