Key and his ministers are trying to spin away the bad news about the crisis in manufacturing (as well-analysed by Anthony Robins this morning on the Standard). The government needs to claim there is no manufacturing and job crisis, in order to justify an extension of a low and menial youth pay (to be announced today). It is also as cover for the fact that most people who move off benefits, don’t do so to get jobs, and that a large number just move to another benefit.
Both the NZ Herald and Stuff are reporting that the government will announce an extension of the “youth wage” today, rebranded as “starting out”. However, with the kinds of wages on offer, and (as Claimed by Matt McCarten) the proliferation of casual, part time and temporary jobs, such jobs are just as likely to be a dead end as the foot in the door to a blossoming career.
Danya Levy on Stuff reports,
The Government is expected to announce details of a ”starting out” wage today in a attempt to get more 16 and 17-year-olds into work.
Economic Development Minister Steven Joyce, Social Development Minister Paula Bennett and Labour Minister Kate Wilkinson will this morning release the Government’s Building Safe and Skilled Workplace programme which is the third of six business growth agenda reports.
It is understood it will include introducing a starting out wage that will be set at 80 per cent of the $13.50 an hour adult minimum wage.
It will effectively double the time workers can be on the Government’s training wage to six months.
Under that regime the $10.40 an hour rate can be paid for three months or 200 hours, whichever comes first.
These changes are unlikely to increase the amount of jobs paying a living wage. They would have many undesirable consequences, including taking jobs from some older people and giving them to young people at a lower wage. This is effectively a subsidy to employers. Claire Trevett in the Herald reports,
Announcing the policy last year, Mr Key had said the lower wage would give many youth “a much-needed foot in the door” and encourage employers to take on youth, rather than more experienced workers.
But Labour argued that it would instead send young workers over to Australia where the pay was higher.
Meanwhile, according to Kate Chapman, Labour MP Jacinda Ardern has received a reply to written parliamentary questions. It seems that Paula Bennett’s claims that her reforms have resulted in more people moving off benefits into work is a bit of a distortion. In August she claimed 6225 people moved from benefits to work. In contrast, in the 3 months to June 30 50,561 came off benefits but didn’t go into work. The biggest number of people moving off benefits are just shifted to another benefit. The next largest movement is the group labelled “8 weeks after a change of circumstances”, then “Full Time Student”.
Here is the list of movements, taken from Chapman’s article and rearranged in order of the greatest to least numbers moved from a benefit:
People of working age whose benefit was cancelled for reasons other than ‘obtained work’ from April 1, 2012, to June 30, 2012.
[NB]: Interesting to note how quickly the TV3 and TV One 6pm News last night, picked up on Key’s spin line about “manufacturing a crisis”. TV One reinforced it in with the print subtitle: Manufacturing Crisis in their news summary. Kudos for TV3 for pointing out how deliberately Key continually repeated there is no crisis.
Both channels willingly aired the visual reinforcement provided by the government, with photo ops of Key in industrial glasses on a factory floor (also conveniently countering the recent images of Key schmoozing with the rich and famous in Hollywood). In contrast, the opposition leaders were shown to be taking a more academic approach to their criticism: Russel Norman in a study with shelves of books behind him; Shearer and Parker seemed to be speaking in an empty classroom.
[Update]According to her own standards, Paula Bennett should be ashamed! In reply to heckling from Sue Moroney in Question Time on 12 September 2012, this was Bennett’s response:
Sue Moroney: Trying to look busy. Doing nothing about jobs, trying to look busy.
Hon PAULA BENNETT: Opposition members call out, but, actually, although the unemployment benefit did drop under them, we saw the sickness benefit increasing, we saw the invalids benefit increasing, and actually they should be ashamed of what they did for those people in that time.
New policy announced, Government press release, CTU press release (Low Wages No Solution), Service and Food Workers Press Release (Poverty Pay Won’t Give Young Workers Skills or Jobs), Labour Party press release (Low Wage Future No Future At All), Green’s press release (pay cut for young workers).