Wage rise seen as 'sensible'

The minimum wage will rise by 50c an hour to $14.25 from April 1 and the "starting out" and "training" minimum wages will increase 40c an hour to $11.40.

A rise in the minimum wage is sensible, but could cause small local businesses to delay hiring extra staff, the Wairarapa Chamber of Commerce says.

"I think any increase is a good thing as long as it doesn't put businesses out of business because that's helping nobody," chief executive Stephanie Gundersen-Reid said.

The comments follow Prime Minister John Key's announcement that the minimum wage would rise by 50c an hour to $14.25 from April 1.

The "starting out" and "training" minimum wages - for youth workers and workers on industry training - will increase 40c an hour to $11.40.

Mr Key said there was a balance between raising the minimum wage and putting jobs at risk, but he believed the 50c rise would have a negligible effect on the availability of jobs.

According to Statistics New Zealand, 17,200 people in the wider Wellington region earn between $13.25 and $14.25 an hour.

Miss Gundersen-Reid agreed with Mr Key that the 50c rise would not have a significant impact on available jobs but said some smaller businesses such as a small store or 'one-man-band' builder could delay hiring extra staff for a few months.

"[The increase is] fair from a business perspective because it is going up quite regularly after not going up for such a long time."

However it was "still not a huge amount of money for a family to live off", she said.

Employers and Manufacturers Association chief executive Kim Campbell said for people at the bottom end of the pay-scale, even small amounts of $20 extra a week to their take-home pay could make a big difference.

Other "safety net" measures were available for low-income earners such as taxpayer-funded Working For Families payments and tax credits.

Most employers would be able to handle the increase because it was a manageable rate, but anything higher could have been a struggle for sectors such as hospitality, he said.

Living wage campaigners, who believe $18.80-an-hour is the bare minimum needed to support a small family, have called the increase a step in the right direction.