11 February 2022
The significant increase in the Minimum Wage has been badly received by the retail sector, with 84 per cent of retailers disapproving of the announcement, according to a snap poll of Retail NZ members.
“$1.20 is another massive increase in the Minmum Wage rate, and can’t come at a worse time for retail businesses that are bruised and bleeding after two years of lockdowns and other COVID restrictions,” Greg Harford, Retail NZ’s Chief Executive said today. “The retail sector is facing huge cost increases from all directions, and has seen a significant drop off in customer confidence in recent weeks as the Red traffic light settings have come into play. Retail NZ has repeatedly asked Government to postpone any further increase in the Minimum Wage, and we are disappointed that the Government is not listening.
“Everyone in retail aspires to pay their teams well, but the sector operates on extraordinarily tight margins. Retail NZ has been inundated with negative feedback about the decision since this morning’s announcement. A snap member poll suggests that most businesses are not in position to absorb the cost increases. Instead, 63 per cent will be looking to increase prices, 47 per cent will be looking at reducing the hours available for employees to work, and 38 per cent will be looking at reducing the number of people employed. The new Minimum Wage rate runs the risk of stoking the inflation fire while perversely reducing opportunities for work.
“A number of members are also considering closing stores, as their businesses become increasingly unviable on the back of Minimum Wage hikes, other compliance issues, COVID-19, and the Government’s proposals for national award bargaining.
“It is time for the Government to push pause on increasing business costs, and to start supporting the businesses that employ most New Zealanders. More than 220,000 New Zealanders work in retail. While the Government may have good intentions with the increase, the reality is that the decision is likely to harm the incomes and job security of those the Government is most wanting to help.”
For more information about the Minimum Wage click here.
For further information, please contact:
Chief Executive, Retail NZ
027 243 2842
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