Mood of the Workforce: 'People are hurting' with only one in four workers' incomes keeping pace with inflation

Thursday, 19 January 2023

Melissa Ansell-Bridges, secretary of the Council of Trade Unions, says a quarter of workers haven't had a pay rise in more than two years.

Three-quarters of working people polled in the Council of Trade Union Te Kauae Kaimahi’s fifth annual Mood of the Workforce Survey say their incomes are not keeping up with inflation.

The council’s (CTU) annual survey was launched five years ago to give a voice to workers as a counterbalance to the annual NZME Mood of the Boardroom survey, which highlights the concerns of company leaders.

CTU secretary Melissa Ansell-Bridges said the results showed who was hurting most from high inflation, and the fight to bring it under control.

“It's clear that people are hurting, and we're really worried that the traditional policy response of raising the official cash rate (OCR) and reducing government spending is only hurting them more,” she said.

* Call for $22.75 minimum wage to reward essential workers

* Many workers effectively earning less as inflation outstrips wage increases

Otago wharfie Josh Greer says times are tough for many workers, who have not yet seen their wages rise as fast as inflation.

One of the workers who was polled in the survey of 1870 union members in the first two weeks of the year, was Otago wharfie (cargo handler) and union organiser Josh Greer, who works at Port Otago.

“It’s not nice. Everything’s gone up in price,” Greer said.

The impact was less hard on people who owned their own homes, with relatively smaller home loans, and earned reasonable incomes, like wharfies, but Greer said inflation was particularly hard on younger workers on lower pay.

The survey revealed that 44% had not received a pay rise in the past 12 months, the period in which high inflation had struck.

A further 20% had not had a pay rise in the last two years, which Ansell-Bridges said raised serious questions about fairness in pay arrangements at many employers.

The survey also revealed the costs workers were struggling with most.

Nearly 60% of respondents said rising grocery prices were the biggest pressure on their budgets followed by mortgage and rent (17%) and transport (8%).

The only practical solution most could see to their woes were pay rises, Ansell-Bridges said.

A majority (61%) believed higher wages were the key to helping them deal with inflation, she said.

Only 16% thought tax cuts would help.

Greer said There were only so many places you could take money from.

“You can’t take it from the power money because the power will be cut off, so really, the only cut-backs you can do, is food.”

‘Given the real causes of high inflation, the idea that the answer to inflation is to cut wages, cut employment, and cut public services is ridiculous, CTU secretary Melissa Ansell-Bridges says.

He estimated the food bill for his household of two adults, and three children, had gone up more than $100 in the past 24 months.

A decent-sized head of broccoli cost $2.50 two years ago, now its half the size and double the price, he said.

“It’s $10 if you want to put a stir-fry on your plate, and that’s just one example.”

The survey found just 23% of people felt their income had risen enough to keep up with inflation, or make them better off, over the past 12 months.

Many were working harder, for longer. Forty-four per cent felt they were working longer hours, and 52% were working harder when at work, and that the quality of their work-life balance had got worse.

With high unemployment, many people felt they were secure in their jobs, with just 30.1% feeling less secure in their jobs than they did 12 months ago.

But it was making ends meet now that was occupying workers’ minds, said Greer.

“It’s getting harder,” he said.

One younger colleague he spoke to recently was facing a very tough 2023.

“Her mortgage was coming up for refixing, so she didn’t have the joy of doing it six, or 12 months ago when it was a wee bit cheaper. She’s looking at an extra $200 a week,” he said.

Contract negotiations were underway at Port Otago, and she wanted to know when a settlement was likely to be reached, he said.

But even a 7.5% pay-rise wouldn’t cover the rise in her home loan payments, he said.

There were plenty of worrying signs of more price rises to come, he said.

ACT leader David Seymour has pledged to push to repeal Fair Pay Agreement laws, if he wins power at the next election.

The national egg shortage, the impending end to half-price public transport, and the April end to the temporary fuel tax reduction, all promised more financial pressure for households.

On Thursday, Stats NZ Tataurtanga Aotearoa revealed food prices went up 11.3% last year.

The CTU would like to see a change to the way the powers-that-be battled inflation, rather than relying on the Reserve Bank hiking the official cash rate, which led to rising home loan rates, and people losing their jobs.

The CTU has called for the country to target specific kinds of inflation that hurt poorer people, most like rent inflation, but it also wanted sweeping changes to economic policies, which it believed would dampen inflation in the long-term, and share the burden of inflation more fairly.

“The cost-of-living crisis is the result of decades-long poor economic settings ranging from a refusal to limit rents and curb property speculation, a dependence on imported oil, a refusal to regulate the supermarket duopoly, through to a failure to invest in developing workforce skills,” Ansell-Bridges said.

The Government’s proposed Fair Pay Agreements were important to lift wages, she said.

ACT and National have vowed to scrap them.

The survey was sent to people on the CTU’s 55,000-name email list of people who have had contact with the CTU via petitions, parliamentary submission calls, community events and fundraising for community causes.

How workers are making ends meet

Comments made by workers responding to the CTU Mood of Workforce survey indicate some are struggling to cope with high inflation, and are feeling powerless, and demoralised.

“I currently work a minimum of 3 jobs to just survive, struggling to just buy fuel and food most weeks.”
“The wages have not kept up with the cost of living. The company I work for has made substantial profit since 2020.”
“Same income, grocery costs increased 20%.”
“Everything is more expensive, not just food & groceries. Makes resilience even more uncertain as it wouldn’t take much to derail me financially.”
“I am working 3 jobs, I have 2 side hustles and still I am barely keeping my family fed and cared for. Something needs to give.”
“There’s something wrong with the state of things when I’m weighing up the cost of taking myself or my kids to the doctor and buying food, and I’m certain I’m not alone in this thinking.”
“Just sick of working to live. Can afford the basics but nothing else. That’s quite depressing. This will cause more mental illnesses within the community.”
“Generally going backwards fast with regards to high cost of living. Having to take in boarders to try and break even. Putting extra stress in family.”