February 5 2007 - The Labour Cost Index (LCI) recorded an increase of 3.2 percent in
salary and wage rates (including overtime) in the year to the December 2006 quarter, Statistics New Zealand said today. Earnings growth was also evident in the Quarterly Employment Survey (QES), where seasonally adjusted total gross earnings increased 9.0 percent in the same period, the largest annual increase recorded by Statistics NZ for this series in the QES.
In the LCI, salary and wage rates (including overtime) for finance and insurance increased 5.9 percent in the year to the December 2006 quarter and 3.0 percent in the December 2006 quarter. These are the largest annual and quarterly increases since the series began in the June 2001 quarter. Matching market rates and the settlement of collective employment agreements were the main reasons given for the latest quarterly increase.
The mean increase was 5.5 percent for all surveyed salary and ordinary time wage rates that rose in the year to the December 2006 quarter. This is the same increase as in the September 2006 quarter. The mean increase was 5.2 percent for the December 2006 quarter, the largest quarterly mean increase since the LCI began in the December 1992 quarter.
QES results for the year to the December 2006 quarter show the annual increase in total gross earnings exceeded the annual increase in total paid hours. This resulted in a 4.9 percent annual increase in average total hourly earnings, to $22.40. Employment, as measured by full-time equivalent employees (FTEs), increased 2.8 percent for the year to the December 2006 quarter.
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