NZ after tax earnings rise faster than in Australia
The real after tax average earnings of New Zealanders have increased faster than those in Australia since 2008, says Finance Minister Bill English.
He told Parliament it is because Australia has had significantly higher inflation than New Zealand over this period and tax cuts across the Tasman have been relatively modest compared to those in New Zealand.
"As a result, the wage gap between the two countries has actually narrowed slightly.
"We are not getting too excited about that, because we are such a long way behind Australia to begin with. But it's a good start."
The figures use data on average weekly ordinary time earnings (per FTE) from Statistics New Zealand's Quarterly Employment Survey - the official series which is also used to calculate the wage floor for New Zealand Superannuation.
The figures have been adjusted to account for income tax and inflation giving a true picture of changes in the spending power of New Zealanders.
Since September 2008, real after-tax wages in New Zealand have increased by 8.7%. Using a comparable series, Australia's real after-tax wages have increased by 4.8% in the same period.
"By comparison, New Zealand wage growth significantly lagged Australia's in the nine years to September 2008. Over that entire period, New Zealand's real after tax wage growth was a paltry 3%, compared with 19% growth in Australia," says English.
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