Wages in New Zealand fall behind despite a recent rise in hiring activity
Hiring and wages in the human resources (HR) sector saw positive developments in September, according to a new report, which warned that pay packets in New Zealand have flatlined despite a rebound in recruitment.
The latest findings from Employment Hero showed that HR hiring was up 4.6% in September, with wages also increasing 3.3% on the previous month.
This is also the case for New Zealand's accounting and legal sector hiring, which was also up 4.6%, with wages getting a 3.3% boost.
The positive development comes as hiring rebounded in September, with employment growth for small and medium-sized enterprises (SMEs) rising 2.0% from August and 4.4% compared with three months ago.
"It's been a choppy year, but with headcount climbing back to 2.0%, up from a dip of 0.7% in August, it's a good bounce back," said Neil Webster, general manager for New Zealand at Employment Hero, in a statement.
Wages not catching up with hiring rebound
Webster, however, pointed out that wages are still falling behind despite the increase in hiring activity.
This is the case in New Zealand's engineering sector, which logged a six per cent hiring boost in September, with only a 0.9% median pay increase.
"What's harder to reconcile is that wages aren't following at a time when the cost of living continues to be top of mind for people. Businesses are hiring, but employees aren't yet seeing the same momentum in their pay packets," he said.
Overall, annual wage growth hit 1.1% in September, with casual workers seeing a stronger 3.7% increase.
But Webster noted that the 1.1% wage growth could be a "monthly fluctuation."
"Annual wage growth has collapsed from roughly four to five per cent mid last year to just 1.1% last month," he said.
"So while September indicates some green shoots, with year-on-year growth the highest since March this year, it could just be a monthly fluctuation so only time will tell. Because currently the trend is still a downward one."
