Written By: - Date published: 10:57 am, May 20th, 2008 - 57 comments
Categories: workers' rights -
Tags: minimum wage, pay, tax
See that line that says minimum wage? Nearly half of kiwis earn less than that.
Seven months ago, that was me. I was working removing asbestos contaminated glue from the floor of an office building along with half a dozen other guys. Now, asbestos is pretty dangerous stuff, inhaling a single thread of it can give you asbestosis, a deadly respiratory disease. So, we had some crappy old masks and some cheap overalls to wear. The areas we worked in were sealed from the outside world and had big fans in them to keep them at low air pressure, so if a leak developed air would flow in and no asbestos threads could get out. The outside temperature was 25 degrees. Inside it was 40 degrees plus and there was no oxygen, as we scraped potentially deadly forty year old glue off the floor. The sweat would pool in your mask but I was afraid to pull it back.
We were effectively day labourers, employed by a labour hire company that contracted our labour (and took $8 an hour as commission from the company); we would be out of a job on the day that the boss decided there was no more work for us (of course, this actually made us work slower because we didn’t want to work ourselves out of a job).
The men I had been working with had been doing jobs like this for years, decades. ‘At least now’, they told me, “we are getting some decent pay” – $11.25 an hour (as was the minimum wage at the time), just eight years before they would have been getting $7.50 an hour and no Working for Families to help them out.
See that $60,000 bracket? Less than 14% of kiwis have incomes higher than that. I’m now one of them. And do I work harder for this great increase in reward? Well, I have a chair, I have a computer, there’s coffee, and air conditioning, I don’t have the risk of contracting asbestosis, damaging my back, or finding my job has simply disappeared, and I get to sit in meetings for hours just letting the conversation wash over me like fresh air, remembering being hardly able to breath in that mask.
So, no, I don’t think this job is harder, and get I paid three times more. I suspect that for most of the people reading this, your working life is more akin to my nice well-paid office job, than that job sweating in a toxin-laden room. It’s very easy in our lives to forget how much better we have it than most.
Every morning, when I get up, I know that I am fortunate. I know that most kiwis have it tougher than I do, I know that my income is good, I know that I am not treated as a disposable automaton by my employer. So, no, I don’t begrudge a government that wants to take a small part of my income to help out those who, because of the nature of our economic system, have it tougher than me and help look after their families.
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Apologies Tane
It was never intended as a threat just a rye observation.
Fair enough then – I read it as a veiled threat but I’ll take your word for it.
Steve has taken a very big personal risk by outing himself considering some of the threats we have received from the Kiwiblog Right, so you’ll understand why I have a very low tolerance on this issue.
Tane
I hope by Kiwiblog right you don’t mean David Farrar I don’t think he’s particularly dangerous or likely to engage in fisticuffs.
In joker’s defence I read his comment as a joke and not threatening at all
a rye observation
Can I get fries with that?
Sorry – I don’t usually do picky spelling (wry), but that one was cute.
HS, no, not Farrar. The Kiwiblog Right refers to the culture in the comments section, and in particular some of the more rabid commenters.
Fair enough thought that’s what you meant – although David and SP doing fight for life would be funny as a fit
r0b
Sorry about the spelling.
I Haven’t had a chance to have lunch yet which can get your brain into a bit of a pickle (do you see what I did there)
Lots of banter, but nobody has a particularly convincing argument why the graph above is not deliberately misleading.
Steve has tried to answer:
I once worked after school in the local fish and chip joint. That would have put me on your graph. However at the time I did not have to buy food, clothing, housing etc.
Many of those that aren’t employed are dependent on others that are. You’ve rolled in together kids with paper runs or mowing jobs, retirees, students, part-time mums and dads, etc. Then you have left the only suggestion being that all low income earners have crummy dangerous jobs.
That’s misleading at best.
[it's not misleading because it's about the incomes of all New Zealanders. Incidentally, your Fish n Chip job would put you on this graph and the one that you want that only counts employed people. SP]
You will find the same type of administrative positions in large corporations and they do the same things. Write reports, make rules, add red tape that annoys the hell out of those people who actually have to implement it. Do you think these corporations would be paying out large sums to people if they didn’t think it necessary?
ha, the productivity chart shows a percentage change from year to year. It doesn’t show that productivity has decreased to zero. It shows that there was no change (0%) in the last period, an increase in the period before etc. It also shows that productivity increases over the long term is stable and hovers around 0% change. Exactly what you would expect.
PS. Do you think you could link the actual data that the blogger used?
If that’s the case then why not use the graph that shows employed people? The post is in the “worker’s rights” category and is framed with examples of terrible employment cases. All of the workers cases mentioned here would be on the employed graph.
Why, at a time when unemployment is historically low, would you include non-workers on a graph about wages?
Is this about workers (eg the cases you use to illustrate your point), or about the rate of national super and the DPB?
I’m all for intelligent argument, but the dots don’t join up between your graph and initial post.
jbc good point.
It would seem all 15+ year olds are on that graph.
Someone working part-time is obviously not going to make full-time annual wage.
‘Nearly half of kiwis earn less than minimum wage’ to me this comment does not really explain much. Is this a bad thing, a good thing, on par with other countries?
If this includes part time workers, 15 year olds doing paper runs, unemployed, whatever… I don’t find the graph useful… or am i missing something?
a bit of a pickle (do you see what I did there)
tee hee!
alex, finally some intelligent life!
You make a good point too. I can’t see what benefit there is comparing the after-school income of my 15 year old self, with my income now as a full-time professional with nearly 20 years of experience.
At 15 I probably thought 5 dollars an hour for slicing potatoes was pretty good. They gave me some free 20c pieces for the games machines! And I didn’t have a mortgage or any dependents either.
captcha: “Prentice rescued”.
just looking at incomes of employed people would ignore the fact that there are people without jobs who want to work and their incomes are lower because they can’t find work. It would also ignore the income levels of the nearly three quarters of a million people who get super, DPB, sickness, invalids, or unemployment (those benefits in order of number of popel who get them).
It’s not such a big deal when you’re looking at one snapshot in time and a very low unemployment period when benefit levels are stable but we’ve done a whole bunch of graphs on incomes and we always use medians and all incomes because otherwise you miss out major effects like changes in employment levels and benefit levels and how those impact on real people.
You can slice and dice the figures anyway to make them look how you want – like when Farrar tried to pretend incomes went up faster under National but looking solely at the average ordinary time full-time wage – that’s why it’s best to stick with the full picture when the question at hand is ‘what is the distribution of income among kiwis?’
we don’t have an infinite number of catagories (we do of tags) so I chose the catagory most aligned with the topic.
jbc. Comments like yours make me despair. 300,000 people earn on or about the minimum wage and many of them do have dependents to look after.
I tried to give you a look into what life is like for the bulk of the population who have incomes around that level and all you can do is talk about when you were a kid peeling potatoes.
Try to imagine, working for minimum wage in a soulless job for a greedy boss who regards you as disposable. Imagine trying to get by and raise your kids on $25,000 a year. And then, imagine that just 8 years ago, under National you were getting just $14,500 a year, and you know that if they come into power again, there will be no more pay-rises for you, even as inflation eats away at what you do get.
I wonder if you can.
Well I’m sorry but I think that the figures presented don’t really tell much of a story. There are too many factors included for a savvy person to be able to distill anything useful. Also, if you lump in all the different types of individual income then you can not really talk about supporting dependents – as they might be in the graph too. That’s where household income would be applicable.
I understand your dilemma of trying to show a broad picture without using too many (complicated) facts and figures – but this could have been done better.
Incidentally, since you mentioned the numbers came from Treasury I looked over there for the numbers. Didn’t find (no worry), but what I did notice was this:
Average family gross income: ($)
- couple with children 92,882
Wow! If that’s true then it is bloody fantastic. I guess WFF has boosted that number.
Steve,
“I tried to give you a look into what life is like for the bulk of the population who have incomes around that level and all you can do is talk about when you were a kid peeling potatoes. ”
“tried” being the operative word, I now see where you’re coming from but this was not obvious from the original post or the graph used to back it up.
Your lumping everything into one graph, it really makes the graph meaningless.
“See that line that says minimum wage? Nearly half of kiwis earn less than that.” … again is this bad? is this good? is this on par with other countries? This statement it not useful if you lump everyone on a graph.
If a solo mum with 3 kids is earning less than minimum wage then that’s bad.
If a stay-at-home-mum who is supported by her husband earning $150k is earning less than minimum wage, big deal.
I’m not disagreeing with the spirit of your post, just the graph that doesn’t follow.
I mean no disrespect to those on low incomes with families, however if you wanted to show the picture of family despair then more carefully chosen facts might do a better job. Quite obviously family incomes are significantly higher than individual incomes.
I don’t need a lecture on poverty though. I know exactly what it is.
Steve
Interesting graph, it shows very clearly just how powerful a zero rated tax threshold of circa $20K would be in delivering more money to the pockets of the most needy.
I think I can see why Dr. Cullen isn’t a fan of a zero rated threshold, that being that if he isn’t taxing low earners he’s not able to play fairy god mother with their own money to buy their support.
Imagine what a different debate this would be if all tax payers (not just targeted groups which were shown by internal polling to be non Labour voters) below the “minimum wage” threshold were not paying tax so that it could be redistributed to people earning more than them.
Steve
When I first started working I was earning $109/week and the dole at that time was $90/week. For my extra $19/week I had to pay $9/week on public transport, $1.50 on compulsory union fees and I had to have a completely different wardrobe than if I had been on the dole. If you were thinking I wouldn’t have a lot remaining to save for house then you would be correct.
At that time people were saying that welfare compared to trainee/apprentice incomes was too high, and/or wages were too low, and that such comfortable welfare provided little incentive to work.
Would you get out of bed at 6:00am catch a train, a bus and work 8 hours then catch a bus and a train 5 days a week for such a slim margin over the dole while incurring additional costs to do so?
So how much has really changed? Here on this blog you bang on about the need to lift wages, as I did then and as I do now. It was a Labour govt then, it’s a Labour govt now and still nothing changes.
Vote for a change, stop being suckered by this “we look after the workers” bullshit from Labour, the Labour pollies look after themselves and the workers get shafted – welcome to Labour govt.
Why don’t you, Tane and a few other anon bloggers here at the Standard start a new workers party, I’d vote for it if it puts it’s own beliefs into it’s policies and stopped being apologists for a bunch of self serving poll driven redistribution junkies.
Whatever Steve, we’ve all done shit jobs while at university. More fool you for taking on an asbestos job.
I’ve paid my own way, paid my own student loan back, paid my share of tax – what do I get out of Labour? Fuck all mate, a shit health sytem, no investment in infrastructure for a decade until it starts to fall down, schools being closed, train system being fuckedup, and now a bunch of freakin right on academic socialists telling me I should be thankful for getting screwed.
I don’t know where you live matey but 60k in Auckland with a mortgage and kids is minimum wage.
Think about the guys you were labouring with who had to support a family – they dont know that x% wage increas was actually 2/5ths of fuck all real increase given the cost of housing and basic living under labour.
“So, no, I don’t begrudge a government that wants to take a small part of my income to help out those who, because of the nature of our economic system, have it tougher than me and help look after their families.”
I disagree on the fact that 39% of my income is “a small part”. I have no children, private health insurance, few if any claims on the State. My direct taxes equate to at least two people on the minimum annual income. How much more do you want? Why is it my problem that people on low incomes feel they have a right to children and a house? I don’t even have a house.
How if I leave the country? Will that make you feel better?