Higher wages fewer jobs

January 15, 2020

The  increase in the minimum wage costs jobs:

Confirmation that the Government’s unbalanced minimum wage rise could cost 17,000 jobs and lump taxpayers with a $125 million bill is an alarm bell for small businesses, National’s Workplace Relations and Safety spokesperson Todd McClay says.

MBIE’s recently-released Minimum Wage Review 2019 reveals the Labour-led Government’s proposed change to $18.90 per hour on April 1 will cost the economy 6500 jobs and increase Government expenses by $62m a year, as well as drive up inflation.

Moving to a $20 an hour minimum wage by 2021, which the Government is proposing, could cost the economy 17,000 jobs and increase expenses by $125m a year.

“The minimum wage changes will see small businesses struggle more at a time when the Government should be supporting them, not working against them,” Mr McClay says.

“The Government is making it harder for small businesses to employ people, harder for them to invest in training and development, and harder for them to get ahead.

“These projections could prove to be much larger if our economy continues to slow and the labour market weakens, as it has already under the Labour-led Government.

“Everyone wants high wages for workers, which is why National increased the minimum wage every year in Government. But we believe the minimum wage should go up in a balanced way that doesn’t go too far, too fast.

Employers expect modest increases in the minimum wage but this government’s fast-tracking bigger increases is too much too quickly, at too high a cost.

“Hard-working Kiwis are already doing it tough because of the Labour-led Government’s poor policies, which are driving up the price of petrol, rent and other living costs.

“The best way to put more money in workers’ pockets is to let them keep more of what they earn. What good is raising the minimum wage if workers are being taxed to the eyeballs?”

Would tax cuts be better than increasing the minimum wage?

An orchard owner in Central Otago is rallying against minimum wage increases, arguing reducing the income tax of a portion of low-wage earners would help them more and do less harm to small businesses.

But a tax expert says it makes more sense to give low-wage earners more social support than to ‘‘tinker’’ with the tax system. . .

The business owner said she did not want to be named out of concern people might react angrily to her view the minimum wage should not be increased.

‘‘I’m all for people getting more money in their pocket.

‘‘The Government needs to look at how they can ensure lower-paid people get more in their wage packet, without damaging especially smaller companies.

‘‘What is the point of more money in a pay packet if the result of that is that it is going to cost jobs, and it gets swallowed up by higher prices for the basics, like fuel and electricity and rents and groceries?’’

Wage rises are a cost to business . If they’re not at least matched by a gain in profit businesses have to increase prices to compensate. That feeds into the economy and soon eats into any increase in pay. If people are paid more but have to pay more for goods and services they’re no better off, and if there are fewer jobs those who lose, or can’t get, a job are worse off.

She said she had a better idea of how to get more money to low-wage earners.

‘‘If they’re going to up wages all the time why don’t they bring the PAYE [rate] down?

‘‘Lower-paid people can have an immediate solid increase in their take-home packet.’’

If you follow the principle of less tax on things we want to encourage and more on things we don’t, tax cuts on wages is good. The trouble is most lower to middle income people pay little or no net tax.

Tax specialist and managing partner at Findex in Dunedin Scott Mason said he had a lot of sympathy for business owners struggling with the increasing cost of wages.

He agreed with the orchard owner the increase in minimum wages could lead to employers not hiring new staff.

‘‘They’ll defer taking an employee on for a longer period of time. Which then has a counterintuitive impact on the economy, accepting of course we’ve got pretty full employment at the moment.

But reducing the income tax low-wage earners paid was ‘‘tinkering with our overall tax settings’’.

‘‘The reality is those on minimum wage — when you take into account their tax rate and their social benefits — aren’t generally net taxpayers anyway.

‘‘We’re basically using the tax system, the people who are net taxpayers, to subsidise [low-wage earners] further.

‘‘It may or may not be right — it’s just a much wider debate is the point I’m making.’’

He said it would be a better idea to increase social welfare to help those more in need.

‘‘If you were going to use the tax system to do it, you’d be better off tinkering with the likes of Working for Families or those sorts of things rather than changing tax rates.

‘‘If you change the tax rate then it affects all taxpayers.’’

If you increase WFF it affects all taxpayers too because that’s who pays for it.

What we need is increased productivity and profits and a reduction in business taxes could help that.

That in turn could lead to sustainable growth in the economy which would, in time, lead to sustainable increases in wages.

That would be much better than wage increases by government decree which have nothing to do with the value of the work employees do, nothing to do with a businesses ability to pay that additional cost and a lot to do with job losses.

 

 

 

 

 


Labour pains, National delivers

December 18, 2019

National promised eight policy papers this year and they’ve delivered.

The government promised this year would be their year of delivery and they haven’t.

You’ll find National discussion documents here.

You’ll find the government’s broken promises here.

They include: child poverty heading in the wrong direction, the level of homelessness is appalling, elective surgery numbers have dropped, economic growth has dropped from 4% under National to 2.1%; job growth has fallen from 10,000 a month under National to just 3,000 under Labour; per capita growth is only 0.5 per cent a year compared with average of 1.7% a year during the last five years under National; the number of people on the dole is up by 22,000, the number of New Zealanders heading overseas has increased by 10,000 a year, the billion trees promise isn’t being delivered and won’t be, not a single cent of the the $100 million Green Investment Fund that was supposed to kick-start $1 billion of investment in ‘low carbon’ industries has been invested, the  commitment this year to making the entire Government fleet emissions-free by mid-2025 was dropped, the government hasn’t been able to find a credible way to introduce a royalty on bottled water exports without trampling all over trade and other agreements with countries New Zealand does business with, yet another working group was set up to address waste minimisation but hasn’t come up with anything yet, the bold goals for housing have been dropped, The 4000 new apprentices target has been quietly dropped. Only 417 have started the Mana in Mahi programme and 32% of them dropped out . . .

Rodney Hide sums it up saying the year of delivery got lost in the post:

This was supposed to be the turnaround year. Prime Minister Jacinda Ardern declared 2019 her Year of Delivery. Nothing has been delivered. Her promise has proved, like her government, empty and meaningless. 

The tragedy is that we accept it. It’s enough that politicians feel and emote; there’s no need to do or achieve anything. We should perhaps rename the country New Feel-Land. . . 

That’s the Year of Delivery done and dusted.

But there’s always next year. The prime minister has plastics again in her sights. She says it’s what children write to her about most. There are news reports she’s planning on banning plastic stickers on fruit.

I scoffed when we had government by focus group. We now have government by school project. . . 

Garrick Tremain sums it up:

What’s all that hot air doing to our emissions profile?

Reducing those is another failure, in spite of the commitment to reducing them being the PM’s nuclear-free moment, they’re increasing and will continue to for the next five years.

A new government ill-prepared for the role might have been excused a first year finding its feet but there’s no excuse for failing so badly to deliver in on its promises in what was supposed to be its year of delivery.


Delivering $132m more on dole

October 29, 2019

The government’s year of delivery has delivered an extra $132m in jobseeker benefits.

An additional $132 million of dole payments have been dished out to people who are able to work in the past year, Leader of the Opposition Simon Bridges says.

“New Zealanders deserve a fair go but not a free ride. Since Labour came into Government an additional 22,000 people have gone on the Jobseeker Benefit.

That’s around the total population of the Waitaki District who could be working but aren’t and on a be fit because of that.

“Social Development Minister Carmel Sepuloni doesn’t seem to care how many people go on the dole and she doesn’t believe there should be sanctions if people show no willingness to get into employment.

“Being in work lifts people out of poverty and improves the lives of families. There’s no excuse for taxpayers having to pick up an additional $132 million, a figure that doesn’t include inflation. This figure is just for people on the Jobseeker Benefit – people who are fit to work and doesn’t include other benefits.

Employers are crying out for workers so there shouldn’t be people who are able to work lining up for the benefit.

These aren’t people who can’t work, they could be working and aren’t.

“This week National will release our Social Services Discussion Document. We’ll release our positive plans to get more people into work and improve the lives of individuals, families and communities.

“National is aspirational for New Zealanders, we want people to have a safety net when they need it but we recognise that this is paid for through taxes and there needs to be accountability and obligations with that.

“The Minister needs to explain to taxpayers why they’re funding an additional $132 million in welfare and what her plan is to get people back into work.”

There are lots of reasons why people who are able to work might not be able to find a job in the short term and benefits provide a temporary safety net for them.

But there’s something wrong with a system that allows the safety net to become a hammock that traps people in dependency when so many employers are desperate for staff.


Sowell says

July 24, 2019


Sowell says

July 23, 2019


Faith first for Folau

April 16, 2019

Rugby Australia has issued a breach notice to Israel Folau:

Folau sparked outrage after posting to his Instagram account last Wednesday night that “hell awaits drunks, homosexuals, adulterers, liars, fornicators, thieves, atheists and idolators” — adding they should “repent”. . . 

What he said is not just a tenet of fundamental Christianity, Muslim and Jewish religions would also regard these as sins.

At its core, this is an issue of the responsibilities an employee owes to their employer and the commitments they make to their employer to abide by their employer’s policies and procedures and adhere to their employer’s values,” Rugby Australia said in a statement.

Freedom of expression, outside work, obviously isn’t one of those values.

“Following the events of last year, Israel was warned formally and repeatedly about the expectations of him as player for the Wallabies and NSW Waratahs with regards to social media use and he has failed to meet those obligations. It was made clear to him that any social media posts or commentary that is in any way disrespectful to people because of their sexuality will result in disciplinary action. . .

This is an employment issue. Folau had been warned and ignored the warning. But was what was required of him fair?

In doing ignoring the warning, he’s chosen to put his faith before football:

Israel Folau is sticking to his guns no matter what it costs the embattled Wallabies superstar.

And he is continuing to place his faith in his religion, despite the storm airing his beliefs on social media has caused within both the Australian rugby and society in general. . . 

It’s obviously a decision that’s in the process right now but I believe in a God that’s in control of all things,” Folau told the Sydney Morning Herald.

“Whatever His will is, whether that’s to continue playing or not, I’m more than happy to do what He wants me to do.”

Folau said he would not mind one bit if his rugby career was done as long as he got to do The Lord’s work.

“First and foremost, I live for God now. Whatever He wants me to do, I believe His plans for me are better than whatever I can think. If that’s not to continue on playing, so be it.

“In saying that, obviously I love playing footy and if it goes down that path I’ll definitely miss it. But my faith in Jesus Christ is what comes first.” . . 

It’s not that long ago that not doing anything against which Folau is warning, would have been a code of conduct that was generally accepted as the right one and the condemnation of people who didn’t follow it would not have been remarkable.

Even now, while some have used social media to confess to being guilty on several of these counts, how can speaking out against any of them that hurt others be wrong?

But of course it’s not Folau’s condemnation of drunkenness, adultery, lying or thieving that’s caused the furor, it’s the inclusion of homosexuality.

Bob Jones points out:

First, these remarks are totally consistent with the Bible (and the Koran) so why the uproar?

Second, why did the critics, including the Prime Minister, solely complain about the reference to homosexuals? What about us drunks and fornicators? Doesn’t she care about our pain? We know the answer to that, namely unlike fairydom we’re not fashionable at the moment.

I can understand journalists concentration on homosexuals as few are whereas make no mistake, the vast majority I’ve known are drunks, adulterers, liars and fornicators to various degrees, so too heaps of MP’s.  A double-standard here methinks.

My contact with journalists and MPs hasn’t involved drunkenness, lying and fornicating but I don’t move in Sir Bob’s circles.

This whole episode is a classic pack-hunting media contrivance. I have difficulty believing a single drunk, fornicator, homosexual, adulterer or liar reading Israel’s remarks gave a damn. He’s entitled to express his religious beliefs as much as I for example am, to continue pursuing my life-long mockery of religion. . . 

An employment breach is between Rugby Australia and Folau but how many would have known about it if the media hadn’t picked up the post?

Only those who follow his account, at least some of whom no doubt agree with him, and others would be following him because of his footy fame and not be troubled by his faith.

But the mainstream media, as happens too often, picked up the post and broadcast it to the world. They then reported the outrage they’d stirred up and also the concern about people who might be upset by it who probably would have been oblivious had the media not generated the publicity.

The offenderati reacted predictably by condemning him and wanting to silence him.

Why when, as Michael Redell points out,  few share his beliefs?:

. . . If –  as most New Zealanders and a large proportion of Australians now claim to –  you don’t believe in the existence of God, let alone of eternal separation from God or Hell, it is hard to know why what Folau is saying should bother you.   You surely believe he is simply deluded and wrong, as he will discover (or rather not) when he dies.

If you don’t believe what he says why not ignore it, or counter it with rational argument?

That probably is the view of a fair number of people in New Zealand and Australia today.  But it isn’t the view of those holding the commanding heights –  MPs, leader writers, columnists, business leaders and so on –  who have demanded that it be stopped.  They simply cannot abide the thought that someone of any prominence should openly affirm that sin is sin, and that homosexual acts are among the things labelled as sin.

Here I’m not mainly interested in the Australian Rugby Union. I have a modicum of sympathy for their position, even if (as I noted in an earlier post elsewhere on these issues) the problem was partly one of their own making.   Rugby could just be rugby, but that’s not enough for today bosses.

My interest is more in what it says about our society – New Zealand and, it appears, Australia –  that no prominent person is free to express centuries-old Christian belief (views backed, rightly or wrongly, by the law of the land until only a few decades ago) when it trespasses on the taboos and sacred cows (“homosexuality good”) of today’s “liberal” elite.  And if no prominent person can –  and it is interesting to note that not a single church leader has been willing to stand up openly for Folau, and the Scriptures –  how will those less prominent be positioned.   Folau may lose a multi-million dollar contract, but he’ll already have earned much more than many ordinary working people make in their life.   But what of the ordinary employee of a bank or of one of those right-on government agencies.  It might not even be a personal social media account, or a speaking engagement at the local church.  It might be nothing more than a reluctance to participate in celebrations of what (in their belief, in the tradition of thousands of years) sinful acts.   The issue here isn’t someone proselytising across the counter of the bank, any more than Folau’s “offence” involved activity in the middle of a game, but a totalitarian disregard for any view –  no matter of how longstanding –  that doesn’t fall into line with today’s orthodoxy.

This is what concerns me too.

I don’t share Folau’s fundamental version of faith.

I find a lot of the Bible contradictory and when I do I choose the option that shows love and grace – turn the other cheek rather than an eye for an eye, for example.

But Folau’s are honestly held beliefs. They don’t impact on his playing ability, he wasn’t preaching during a game, why shouldn’t he be allowed to express them?

And there’s also the niggling thought that some religions are more equal than others and if his was another faith rather than Christian, he would he have been given a little more leniency.


Rural round-up

January 27, 2019

Temporary work visas need over-haul – farmers  – Gill Bonnet:

Farmers say they face having to send skilled workers home in 18 months time because of how their jobs are measured by immigration officials.

Immigrants classed as low-skilled since 2017 have been allowed maximum visas of three years and not been able to sponsor spouses and children.

The changes to temporary work visas were introduced weeks before the last election. . .

Guy Trafford takes another look at a growing problem that never seems to get resolved, notes a full effort to protect ‘old world’ markets and assesses changes to farm gate prices  – Guy Traffod:

New Zealand horticulture has made the news recently with the demand for fruit harvesters that is not being meet. With the unemployment rate hovering around 4% (3.9% is latest data) the likelihood of finding enough staff from that sector is reasonably remote.

The same issue has been an ongoing one for agriculture. Dairying has had an ongoing issue with finding and maintaining staff and while sheep and beef and cropping have lower rates of turn over, finding new staff has still been a problem and getting more difficult by the year.

When the age profile of those working in agriculture is examined then more concern should be raised. . . 

Sheep farming, it’s in our nature – Luke Chivers:

Northwest Waikato sheep and beef  farmers Tom and Nicole Whitford never planned on working in the primary sector but today the couple are dedicated to the intergenerational transfer of a farming business.Luke Chivers explains.

It was Gypsy Day 2016. Waikaretu Valley farmers Tom and Nicole Whitford’s succession agreement with Tom’s parents for a well-nurtured and developed, panoramic coastal slice of rural New Zealand kicked in – coincidentally the same day their son Mac was born.

But that wasn’t their initial plan. . .

Small environmental footprint takes district mayor’s Eketahuna farm to finals – Christine McKay:

Mike and Tracey Collis may run a dairy farm with big ambitions, but they have managed to achieve a small environmental footprint.

To boot, they farm in Eketahuna – a renowned challenging farming area. Their tenacity and their talents caught the eyes of this year’s Horizons Ballance Farm Environment award judges who credited the couple’s willingness to adapt their farming system to outside influences.

“We are really pleased about being a finalist,” the Collis’ say of their achievement. . .

Beekeepers urged to vote for a commodity levy

Apiculture New Zealand (ApiNZ) is calling on commercial beekeepers to vote for a commodity levy with voting papers going out this month.

“We are at a crucial juncture in the history of this industry,” says Bruce Wills, chair of Apiculture New Zealand, the body leading the vote. “We need beekeepers to vote and we need a clear statement from the beekeepers through this vote. . . 

Poposed honey levy divides beekeeprers –  Maja Burry:

A vote by beekeepers on a proposed honey levy next month has seen one industry group rallying its members to reject the proposal.

Apiculture New Zealand, a voluntary body of about 900 members, wants to introduce a commodity levy on honey to help manage industry growth.

The proposed levy would see all 1800 beekeepers in New Zealand with 26 hives or more to pay a levy of 10 cents on each kilogram of honey – collecting about two million dollars a year.

But New Zealand Beekeeping president Jane Lorimer said the the levy was unreasonably high.


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