After-tax wages continue to rise faster than prices, Finance Minister Bill English says.

The real after-tax average wage increased 2.5 per cent in the year to March 2011, after accounting for all consumer price increases including food prices and the one-off rise in GST last October.

“Everyone’s circumstances are different, and we appreciate things remain challenging for many New Zealanders. But it’s encouraging to see that, on average, take-home wages continue to rise faster than prices,” Mr English told Parliament today.

“In the latest March year, the after-tax average wage grew 7.1 per cent in nominal terms and 2.5 per cent after adjusting for inflation.

“This means that since September 2008, after-tax wages have increased 17 per cent in nominal terms and 10 per cent after adjusting for inflation.

“That compares with real growth of just 4 per cent over the entire nine years to September 2008.”

“To put these figures into perspective, New Zealand’s 2.5 per cent increase in inflation-adjusted after-tax wages in the latest year compares with just 0.6 per cent real growth in Australia.”

The figures use data on average weekly ordinary time earnings from Statistics New Zealand’s Quarterly Employment Survey. This is the official series used to calculate the wage floor for New Zealand Superannuation. Comparable data is drawn from the Australian Bureau of Statistics.

“This Government is committed to helping New Zealanders get ahead, enjoy higher incomes and lower interest rates for longer,” Mr English says. “This will require continuing change, year after year, to put the economy on a more competitive footing.”