Labour Cost Index (Salary and Wage Rates): September 2011 quarter

• Annual wage rates grow 2.0 percent
• Private sector pay rates increase 2.0 percent
• Public sector pay rates increase 1.8 percent
• Pay rates for education professionals up 1.0 percent in the September quarter
• Majority of increases no more than 3 percent
• Analytical unadjusted LCI grows 3.3 percent
• Quarterly Employment Survey (QES) and LCI salary and ordinary time wage rates rise
• Christchurch earthquakes

Annual wage rates grow 2.0 percent

The labour cost index (LCI) increased 2.0 percent in the year to the September 2011 quarter, after increasing 1.9 percent in the year to the June 2011 quarter.

All salary and wage rates (including overtime) rose 0.6 percent in the September 2011 quarter, after rising 0.4 percent in the June 2011 quarter.

 
Salary and ordinary time wage rates increased 2.0 percent in the year to the September 2011 quarter, following an increase of 1.9 percent in the year to the June 2011 quarter. In the September 2011 quarter, salary and ordinary time wage rates rose 0.6 percent, after rising 0.5 percent in the June 2011 quarter.

Overtime wage rates increased 2.2 percent in the year to the September 2011 quarter. This follows an increase of 2.3 percent in the year to the June 2011 quarter. In the September 2011 quarter, overtime wage rates rose 0.6 percent, down from a 0.9 percent rise in the June 2011 quarter.

Private sector pay rates increase 2.0 percent

Private sector salary and wage rates (including overtime) increased 2.0 percent in the year to the September 2011 quarter, following increases of 2.0 percent in the years to both the June 2011 and March 2011 quarters. In the September 2011 quarter, private sector salary and wage rates (including overtime) rose 0.5 percent – after a 0.5 percent rise in the June 2011 quarter.

In the September 2011 quarter, salary and ordinary time wage rates for the private sector rose 0.5 percent and overtime rates rose 0.7 percent.

 

Public sector pay rates increase 1.8 percent

All salary and wage rates (including overtime) for the public sector increased 1.8 percent in the year to the September 2011 quarter, after increasing 1.5 percent in the year to the June 2011 quarter. The increase in salary and wage rates (including overtime) in the year to the September 2011 quarter resulted from a 1.7 percent increase in central government and a 2.2 percent increase in local government salary and wage rates.

In the September 2011 quarter, all salary and wage rates (including overtime) for the public sector rose 0.6 percent. This follows a rise of 0.3 percent in the June 2011 quarter. In the September 2011 quarter, the increase was a result of 0.6 percent and 0.5 percent rises in the central government and local government salary and wage rates (including overtime), respectively.

Pay rates for education professionals up 1.0 percent in the September quarter  

In the September 2011 quarter, a collective employment agreement increase for secondary school teachers contributed to a 1.0 percent rise in pay rates for education professionals.

Salary and wage rates (including overtime) for education professionals increased 2.2 percent in the year to the September 2011 quarter. This is an increase from the year to the June 2011 quarter, when pay rates increased 1.4 percent.

Other occupation movements – automotive and engineering trades workers and labourers

There were higher than average increases of 0.7 percent in the September quarter for automotive and engineering trades workers and for labourers.

In the year to the September 2011 quarter, salary and wage rates (including overtime) for automotive and engineering trades workers increased 2.4 percent. The main reason respondents gave for the latest quarterly rise was to reflect cost of living.

Majority of increases no more than 3 percent

In the year to the September 2011 quarter, 31 percent of salary and ordinary time wage rates in the surveyed sample increased by no more than 3 percent, while 25 percent increased by more than 3 percent. In contrast, in the year to the September 2008 quarter, 12 percent of salary and ordinary time wage rates in the surveyed sample increased by no more than 3 percent in the year to the September 2008 quarter, and 51 percent increased more than 3 percent.

 

In the year to the September 2011 quarter, 56 percent of salary and ordinary time wage rates in the surveyed sample rose. After the 2008/09 recession, the proportion of salary and ordinary time wage rates that rose fell to a low of 43 percent in the year to the March 2010 quarter.

While the proportion of the sample increasing has risen since the recession, the mean increase has remained relatively similar. In the year to the September 2011 quarter, the mean increase for all surveyed salary and ordinary time wage rates that rose was 3.6 percent. Between the March 2010 and September 2011 quarters, the annual mean increase has been relatively flat – within 3.5 to 3.9 percent – while the proportion increasing has risen from 43 percent to 56 percent.

The median (or middle) increase for all surveyed salary and ordinary time wage rates that rose in the September 2011 quarter was 3.0 percent, which is the largest since a 3.7 percent median increase in the September 2009 quarter. Eighteen percent of rates rose in the September 2011 quarter, which is the highest proportion for a September quarter since 2008, when 23 percent of rates increased.
 

Analytical unadjusted LCI grows 3.3 percent

The analytical unadjusted series is an additional measure that is intended to complement the official LCI and Quarterly Employment Survey (QES) indicators. Like the LCI, the unadjusted series measures changes in salary and wage rates for a fixed quantity of labour, but reflects quality change within occupations in addition to price change.

Unadjusted salary and ordinary time wage rates increased 3.3 percent in the year to the September 2011 quarter, after increasing 3.4 percent in the year to the June 2011 quarter. In the September 2011 quarter, unadjusted salary and ordinary time wage rates rose 0.9 percent – after rising 0.8 percent in the June 2011 quarter.

Private sector unadjusted salary and ordinary time wage rates increased 3.5 percent in the year to the September 2011 quarter. This follows a 3.7 percent increase in the year to the June 2011 quarter. Unadjusted salary and ordinary time wage rates in the private sector rose 1.0 percent in the September 2011 quarter – after rising 0.8 percent in the June 2011 quarter.