What a fascinating business section in the paper today.
Firstly, the section had a wrap around. For those who don’t know, a wrap around is a full-page ad on the front page of a paper or a section of the paper.
Todays’s wraparound was paid for by the Westpac bank and its headline was “minimum is not enough. It’s time.”
Westpac has decided that the lowest wage to be paid in their corporation will be the living wage - not the minimum wage. The ad says the living wage will add at least $131 to the lowest paid’s weekly wage. They think it will make a world of difference. It’s an extra week's worth of groceries. Westpac currently employs 480 people on minimum wage.
But they also say it will grow their business and will mean workers take more pride in their work, feel more valued and hence more enthusiastic. Then they challenge other big businesses to join them.
So good on them, it’s their choice. The cynical amongst us might note that what with the Australian Banking Royal Commission and the FMA here snooping around banking practices, it is a good time for some positive press.
But it’s interesting because then you look what’s on page seven of the business section, Employers warning that the Government’s Fair Pay Working Group recommendations could bring risks to business and the economy. The group wants minimum standards for industries or occupations
Right beside it is an article saying that the movement of big businesses adopting the living wage has been disappointingly slow.
Then on page six, an infometric report says New Zealand’s poor productivity, low wages and capacity constraints means that we are not as well placed as we should be to ride out the economic slowdown that’s starting to loom.
Putting all that together, you get the feeling that when it comes to wages and pay and investment in staff our industries are loathed to loosen their purse strings. And while that makes the short term bottom line look good for the shareholders, we’ve come to the end of the culdesac.
We’ve run out of workers. We need more skills but there will be a lag while we train them, if we can find them. And then when we find them we’re not paying them very much.
Add to that the high cost of living here at the edge of the world, then that’s a messy little scenario where people start thinking of bailing the country for greener pastures, where they’re more valued.
Add to all that the automatic no that comes out of employers mouths when the government starts telling them to pay workers more, then we’re really in schtook.
So on that negative note, let’s congratulate Westpac and others like AMP and Vector who have taken a standoff their own volition. I bet they’ll never regret it and the balance sheet will look just fine. Wages and productivity is not a government problem. It’s all of our problems and we can all do so much better.