Well, the Department of Labour has confirmed what we all knew. New Zealanders are working ever longer hours, and now, one in three full time employees are working over 50 hours per week.
The cause of this can be traced back to the National Party's Employment Contracts Act 1991 - which destroyed unionism in NZ (union membership dropped from 55% of the workforce in 1990 to be just 20% in the late 1990s), and consequently workers have a relatively weaker bargaining position, and are less able to withstand demands by employers to work longer hours. In fact this is an international trend, in countries with lower union coverage.
The Employment Contracts Act also did away with overtime pay for working long hours, weekends and nights, meaning that it became more attractive for employers to seek increased output/profits through requiring employees to work longer hours, rather than investing in productivity-increasing capital/machinery. As a result, our productivity growth ($ output/labour hour) has been falling behind Australia's over the last 20 years, resulting in slower wage growth. Contrary to what National has been saying, the wage gap between NZ and Australia isn't due to us being over-taxed, in fact we are the third lowest-taxed developed country on the planet (if you count Mexico as developed), and are in fact taxed far less than Australians are.
If we really want to enjoy a good lifestyle with high wages and reasonable working hours, we need to demand that employers pay a higher wage rate for every hour worked in excess of the 40 hour working week that we were promised in 1938 by the first Labour Government. Otherwise we'll just end up working longer and longer hours, and have no time left over to enjoy what we have earned with our hard work. This law change was proposed earlier this year by Labour, but was dumped after alarmist claims by the National Party, that it would be limiting peoples' choice to overwork (in fact they would still have that choice, they would just be paid more).
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Nome, I don't disagree with a lot of what you say, but what about the international trends? Other countries didn't have the ECA, though they have experienced heightened international competition and union decline.
ReplyDeleteAnother interesting point is that, despite reporting that they are working harder, NZ workers also report being very happy at work -- though the low-paid workers in hospitality, retail, and so on notably less so.
"Other countries didn't have the ECA, though they have experienced heightened international competition and union decline"
ReplyDeleteYeah, I wasn't very clear on that. It's the countries that have centralised collective bargaining, and consequently have high union density, that have lower working hours.
So it's more about union coverage than union membership (i'm sure you will be savvy to the difference).
"despite reporting that they are working harder, NZ workers also report being very happy at work "
Yes, very interesting. You have a reference so I can check it all?
hi man it's matty. saw u on day bus.
ReplyDeletetrak me down and we'll drink. Sorry this ain't an informed comment on yr blog...