Striking while the iron’s hot

Twenty-seven years after the Employment Contracts Act made union membership voluntary, the current coalition government has named Jim Bolger – the Prime Minister in 1991 – to head its Fair Pay Agreements working group. Fair Pay Agreements are meant to become the centrepiece of employment law policy, yet no one is quite sure yet what they are, or how they will alter employment relations. Among these changes, strike action by nurses, and union meetings, we thought we’d provide a primer on various aspects of the industrial relations scene.

Rising fuel prices threaten to squeeze economic growth

Motorists have been incensed this week, with the price of 91 octane petrol heading over $2.30/l in some parts of the country. Increased fuel prices aren’t yet at the highest (real) levels we’ve ever seen – but they’re close. Based on the unrest in the Middle East, fuel prices might remain elevated for some time. This will hurt more than just the classic Sunday drive, with airfares, freight costs, and eventually goods prices also needing to increase to cover higher fuel bills.

Budget 2018: Government gets realistic on KiwiBuy

Today’s Budget gives us a clearer picture of the government’s intentions for housing over the next four years. More practical KiwiBuild targets have been mixed in with increased spending for health and education building, alongside a state housing boost. However, details are scant, and increasing funding without detailing exactly where it will be spent signals to us that actual activity will be pushed back further.

Finding a cheap place to fill up just got harder

Transport funding and how much we’ll all pay at the pump has been all the (road) rage recently. In late March, the government introduced legislation to allow Auckland Council to implement a regional fuel tax, and in early April the Government Policy Statement on Land Transport was published, signalling a 3-4c/l annual increase to petrol prices nationally.

Have we lost faith in the economy?

A raft of unfavourable confidence surveys have been released over the last couple of months. Firstly, ANZ’s business confidence surveys for November and December showed confidence at a nine-year low. And last week the headline figure in the NZIER’s Quarterly Survey of Business Opinion (QSBO) fell into negative territory for the first time since 2015. Is the economy going downhill or are we just in an election-related blip?

Low wage growth amidst tight labour market

Labour market statistics for the June quarter will be released by Statistics NZ next week and are expected to show the job market continuing its good performance.  But in spite of low unemployment and capacity pressures spreading more broadly across the labour market, rather than being concentrated in a few select industries (eg construction), there is little sign yet that wage growth has begun to pick up steam. Nevertheless, with inflation back up inside the Reserve Bank’s target band of 1-3%pa during the last three quarters and population growth likely to start tapering off, we expect to see a pick-up in wage growth over the next year.