Key on youth minimum wage

August 30th, 2011 at 12:00 pm by David Farrar

NZPA report:

Scrapping the for young workers could result in people being paid as little as $2 an hour, Prime Minister says.

His comment came after Act leader Don Brash last week proposed abolishing the minimum wage for people under 20, which he said would result in more people working for less rather than fewer people earning higher wages.

Key has said the Government would consider reinstating , but today raised issues with Dr Brash’s more radical proposal.

The proposal would result in “very low wage rates” and some companies would hire people for as little as $2 an hour, he said.

Actually for many young people there already is no minimum wage. It doesn’t apply to those aged under 16. So I disagree with the PM that moving the minimum wage coverage from 16 to 18 would lead to lots of people working for $2 an hour. Are there many 15 year olds working for $2/hour?

Incidentally when I was at 14, I did get a job for $2/hour. Now today that is worth $7/hr, but regardless is still around half of the minimum wage. It was working at Woolworths cleaning rubbish bins out etc during the week and doing checkouts on Friday night. Having an after school job was great in terms of learning the value of work.

Today no one would be on $2/hour because the welfare system sets a de facto minimum wage of around $4.50 an hour.

Incidentially if it is so wrong to have different minimum wages, based on age – then why it is okay to have different dole payments based on age?

An 18 and 19 year old gets paid less than a 20 – 24 year old by around $37 a week, if both live at home.

And a 25 year old gets paid $38 a week more dole than a 24 year old on the dole.

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33 Responses to “Key on youth minimum wage”

  1. MajorBloodnok (361 comments) says:

    How much does an intern get paid? Officially $0. But sometimes $20/week, irrespective of age. Where is your minimum wage then?

    (BTW, I agree with reducing/removing minimum wage limits.)

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  2. toad (3,674 comments) says:

    Those under 16 are in compulsory education. What they may earn after school or in the holidays is meant to be pocket money – they are not expected to have to live on it. After 16, when they may opt to be in the workforce full-time, they should be able to earn enough to live on.

    I’ve also been puzzled about the youth rate of the dole. I asked Jenny Shipley how she justified it once at an election meeting when she was the Social Welfare Minister, and all she could come up with was that [some] younger people had lower costs because they lived with their parents or in flats with others.

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  3. Monique Watson (1,062 comments) says:

    ‘His comment came after Act leader Don Brash last week proposed abolishing the minimum wage for people under 20, which he said would result in more people working for less rather than fewer people earning higher wages.’

    more people working for less rather than fewer people earning higher wages’.

    Well that’d theoretically be the same outcome as what you’d get from voting Green/Labour/Mana.

    Now the Voterati will be confused.

    Nice one Don

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  4. Viking2 (11,471 comments) says:

    Those under 16 are in compulsory education.

    Already first line major fail. You cannot compulsorly make people learn. You perhaps can force them to turn up, to be disruptive and so on.

    I was well into work at 16. Couldn’t wait to leave school and there are plenty of young people out there just like that.
    They leave and become good citicens in their homes and their workplaces.

    Of course all the girls need to do is get pregnant, to be paid well but boys on the other hand are put down, beaten up,discrimated against and so on.
    There is no reason at all why young people shouldn’t start work at 15 and be paid $4.50 an hour with increases each six months mandated until they reach adult rate at20.
    These are of course minimum provisions and good employers of good young people can elect or negotiate to pay more.
    Not hard to do, good for everyone. –Well maybe except for dumb arse politicans as it would be one less stupid bloody rule our lives thing that had to do everyday.

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  5. Viking2 (11,471 comments) says:

    Monique Watson (80) Says:
    August 30th, 2011 at 12:23 pm

    ‘His comment came after Act leader Don Brash last week proposed abolishing the minimum wage for people under 20, which he said would result in more people working for less rather than fewer people earning higher wages.’

    more people working for less rather than fewer people earning higher wages’.

    Well that’d theoretically be the same outcome as what you’d get from voting Green/Labour/Mana.

    Now the Voterati will be confused.

    Monique go and do some homework instead of prattling on in gossip fashion.

    http://www.act.org.nz/news/creating-new-jobs-thats-what-its-about

    http://www.act.org.nz/news/national%E2%80%99s-message-to-youth-stay-on-the-couch

    Nice one Don

    And somewhere last week on Kiwiblog is a link to Brashes speach. Just in case you might be interested to learn!
    Sorry work to do no time to find it for ya.

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  6. mikenmild (11,247 comments) says:

    Was that the speech where he rambled on about learning proper grammr when he were a lad?

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  7. Ed Snack (1,873 comments) says:

    This comment makes me lose a lot of respect for John Key, it’s a cheap throw-away line worthy of a low-life green or labour politician. So what if someone wants to work for $2 an hour, they don’t have to and I struggle to see how, short of government coercion which is far more a left-wing tactic anyway, they could be forced to.

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  8. RightNow (6,994 comments) says:

    Viking2, I’m guessing when you left school there was a surplus of jobs available, probably around the time we were also importing Pacific Islanders to meet the shortfall (and years later deporting them as ‘over-stayers’, another story), and an able bodied young man could probably earn more as a labourer or freezing-worker than his teacher was making.

    NZ will never again have enough jobs at the low-skill level to be able to offer anywhere near full employment. The only option (and I predict we’ll see this next term) is for the government to make jobs (e.g. ‘conservation jobs’) – work for the dole schemes. Alternatives are to abandon free trade and return to protectionism, fix our dollar low, and abolish the minimum wage.

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  9. andretti (130 comments) says:

    I employ around 60 people,and while occasionly I will employ an under 20 it is usual that they have no qualifications and poor attitudes.the fact is that a advertisment will bring forward maybe 40 applicants and it is normal to employ the one with the most experience,its not really rocket science.We would rather pay $15 per hour for experience than $13 odd to have to train them,not only in the job but how to interact with customers and fellow workers ect.

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  10. berend (1,709 comments) says:

    Getting somewhat impatient with self-confessed socialist John Key DPF

    [DPF: I've blogged on this issue over a dozen times, and will continue to do so while I think the policy is wrong. But it is no surprise that I do not agree with the Govt on all of its policies]

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  11. toad (3,674 comments) says:

    @Ed Snack 12:56 pm

    It would effectively be compulsory. If you don’t take a “suitable” job, you don’t get the dole. If you don’t have a job or get the dole, you starve (or steal). So young people would effectively have no choice but to take jobs that pay $2 an hour.

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  12. Jimbob (641 comments) says:

    When I was 15 I received nothing for my work. I suppose I had three hots and a cot and was educated.

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  13. MT_Tinman (3,188 comments) says:

    First job I had was the cub-scouts’ “bob-a-job”.

    $2 is good compared with the nothing I got for that.

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  14. lastmanstanding (1,297 comments) says:

    Better a $5 p hr job for a school kid that wants some pocket money and a chance to find out what the world is about than no job at $15p hr.

    But of course that common sense and Gumints and expecially Socilaists dont do common sense

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  15. Lee01 (2,171 comments) says:

    Reinstating youth rates makes the most sense, and I hope National does consider it seriously. Brash’s proposal is too extreme and I’m not sure it would be just.

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  16. Viking2 (11,471 comments) says:

    RightNow (3,100) Says:
    August 30th, 2011 at 12:57 pm

    Viking2, I’m guessing when you left school there was a surplus of jobs available, probably around the time we were also importing Pacific Islanders to meet the shortfall (and years later deporting them as ‘over-stayers’, another story), and an able bodied young man could probably earn more as a labourer or freezing-worker than his teacher was making.

    NZ will never again have enough jobs at the low-skill level to be able to offer anywhere near full employment. The only option (and I predict we’ll see this next term) is for the government to make jobs (e.g. ‘conservation jobs’) – work for the dole schemes. Alternatives are to abandon free trade and return to protectionism, fix our dollar low, and abolish the minimum wage.

    Yep but there were still people who didn’t work and others that worked for all sorts of wages.
    School is not the be alland end all of learning for everyone. Most of us at heart are not socialist and are capable of getting on with life given the oppourtunity. The fact that you sad buggers can’t shouldn’t be our problem.

    It takes enterprise to create jobs but unfortunatley enterprise in NZ consists fo being overruled by politics and bueracrats of all kinds and that’s why we don’t have enough jobs. Remove the barriers to jobs and job creation and we would be hunting for staff as we were a few years back. To say that there will never be enough jobs tells me that you lack gumption, ambition, ideas, and are truly a piss poor excuse for a leader of any kind.

    There are thousands of small busineses in NZ. Can’t remember how many but many,many thousands. If 80% of them employ 1, yep just one then we wouldn’t have enough people.
    Its that simple.
    So the question is; what do we have to do to get each small business toemployone more person?

    Nothing is ever complicated. (except by people unable to think properly)

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  17. RightNow (6,994 comments) says:

    ” If 80% of them employ 1, yep just one then we wouldn’t have enough people.”

    Assume 154,000 unemployed (last time I checked the stats) and divide by 0.8 = 192,500.

    “So the question is; what do we have to do to get each small business toemployone more person?”

    If nothing is ever complicated, I’ll look forward to you answering your own question…

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  18. RightNow (6,994 comments) says:

    Edit – the calculation above was just to work out how many small businesses your scenario would suggest there are. It’s quite probable (if you count sole traders) that there’s actually far more than that.

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  19. wikiriwhis business (4,016 comments) says:

    Considering National is the party that taxed paper boys and is taking govt gurantee off savings in prearation for a world wide depression we can expect anything from them. I suspect Key will retire some time after winning the elction in 2012.

    I think he’s got most of his aims achieved for the banks.

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  20. Lee01 (2,171 comments) says:

    “I suspect Key will retire some time after winning the elction in 2012.”

    Well you should know, being an expert and all and having special insight into Key’s thinking.

    Oh wait….

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  21. side show bob (3,660 comments) says:

    Is the arse wiping liberal, Shonkey losing the plot. I can’t fugue the man out, maybe his wealth has gone to his head, for fucks sake whats wrong with someone under 16 working for 2$ an hour, at least they are off the street and getting some work experience. Shit I was working before I can even remember and would have been in seven heaven if I had been earning $2 a hour. If I had lived under Shonkeys rules and had to wait tell 16 to be paid some arbitrary figure I would have been a lazy useless sack of shit. We are breeding a dead beat country and screwing up our futures by smoothing nanny state rules that are quite frankly quite fucking mad. I quickly getting over the National Socialists.

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  22. Lee01 (2,171 comments) says:

    “and screwing up our futures by smoothing nanny state rules that are quite frankly quite fucking mad. I quickly getting over the National Socialists.”

    The quality of your English is impressive. I am definitely going to take you far more seriously from now on.

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  23. emmess (1,428 comments) says:

    In the mid 90’s, I had a job picking strawberries, it paid by the amount collected.
    I calculated the pay after the first day at a bit over 2 bucks an hour.
    I didn’t go back because I knew it was shit.

    How about instead of minimum wages, information is provided to stupid people on wages below a certain level to inform them of what a market rate for their job should be instead of punishing the rest of us?
    Say a quarterly meeting with a MSD officer for people earning below the current minimum wage?

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  24. Monique Watson (1,062 comments) says:

    Viking2 (4,992) Says:
    August 30th, 2011 at 12:36 pm

    Monique go and do some homework instead of prattling on in gossip fashion.

    http://www.act.org.nz/news/creating-new-jobs-thats-what-its-about

    http://www.act.org.nz/news/national%E2%80%99s-message-to-youth-stay-on-the-couch

    @Viking2
    Thanks for the links to the ACT propaganda. Can’t find the links to the independent studies proving the as yet unproven theory that if you cut the pay-rate of a certain group they are more likely to be employed.

    Speaking of theories. I have a theory that you’d have commented differently if my handle was a pseudonym – say BigBoy101 instead of my real name.

    Say what you will about prattling. I’ll sit here in my sanity sniggering about how the Don unwittingly aligned himself with socialism by saying it’s better that more people get paid less.

    Oh – there was one piece of text in the actaganda that I related to:
    ‘Do you know a young person struggling to find work’?
    Yes- I just employed her this week. She’s a teenager, offered to work for ten bucks an hour. She’s competent and I didn’t want to pay her less than the adult minimum as I believe it’s bad for an ongoing working relationship and ultimately productivity. Paying less doesn’t necessarily benefit the worker or the business. Don’t get me wrong I don’t believe we should be completely beholden to unions – I just don’t believe in a youth rate.
    I believe in apprenticeships funded thru some level of co-operation of Polytechs with work places. especially for boys. Unemployed teenagers should be in a combination of training and work. In my humble opinion. ‘My’ young person I have just employed is receiving the adult minimum wage and training through an outside agency. At the end of three to six months, she’ll be a good do-er, completely competent in her role and I’ll have had the benefit of having someone else train her – this could be extended to anything even professions.

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  25. robcarr (84 comments) says:

    Actually there would not be a $4.50 minimum for all due to the welfare state. Those under the age of 18 do not have the same rights to claim the benefit as adults as they have education/training requirements so they could easily be forced into taking a $2 an hour job if they really can’t handle school.

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  26. freedom101 (504 comments) says:

    John Key turns his nose up at low paid work. It’s the first rung on the ladder for many. Instead he would rather they go on the dole, become depressed, get into a bad scene, end up topping themselves, lose faith in ‘the system’, have no idea what work is about, don’t get into the habit of contributing and being connected.

    Why are we surprised at the level of youth suicide when large numbers are locked out of the workforce by government regulation? It’s OK to draw $4.50 an hour on dole doing absolutely nothing but rotting away, but not OK to work for twice that hourly rate.

    National has blood on its hands. It’s disgusting. ACT at least has the guts to tell the truth and proposes something that could actually fix this problem.

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  27. Luc Hansen (4,573 comments) says:

    blockquote>So the question is; what do we have to do to get each small business toemployone more person?

    Offhand, I’m guessing the answer would include the word “subsidy”.

    Incidentially if it is so wrong to have different minimum wages, based on age – then why it is okay to have different dole payments based on age?

    It’s not OK. There should be one rate for all single people, young or old. That should be natural ACT policy.

    As I have said here before, when I began employing people on my own account, I employed kids and saw them work just as effectively as the adults. So I ended up employing them all at the lowest adult rate and moving them onto full rates after three months. The difference between youth rates and adult rates is just petty cash to the employer but significant to the young person. I gained a lot of staff loyalty with my attitude, as well.

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  28. KH (695 comments) says:

    We need an economy where the small employer can, without subsidy to be able to employ people and make money at it.
    We need an economy where any young person can doorknock a commercial/industrial area and be able to find a job in a morning.
    We had that 40 years ago. And those who think that low skilled young people will never be employed again in history need to rethink. That’s just not a viable option. We have those people and always will. So we gotta work for an environment where it works for them. Because it’s in their interest — and not least — also in our interest.

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  29. Viking2 (11,471 comments) says:

    Luc Hansen (3,130) Says:
    August 30th, 2011 at 6:56 pm

    blockquote>So the question is; what do we have to do to get each small business to employone more person?

    Offhand, I’m guessing the answer would include the word “subsidy”.

    You really are a slimy piece of trash ain’t you.
    We have subsidies now and they are limited in their ability to get people into work.
    Like anything socialist they are band aids on the real problem.

    But until you get out and about and move from nappies to real mens work you will never understand it will you?

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  30. Viking2 (11,471 comments) says:

    The difference between youth rates and adult rates is just petty cash to the employer but significant to the young person. I gained a lot of staff loyalty with my attitude, as well.

    Stump up the petty cash for 30000 young people then.
    Loyalty lasts just as long as the pay cheque comes from your hands, Stop it and see how long hungry bellies enjoy your perceived loyalty.

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  31. Nick K (1,244 comments) says:

    If John Key is so concerned about $2 p/h wages, why did National campaign on reinstroducing youth rates?

    I earned $1.50 p/h for my first job, and really appreciated every cent.

    This is National being more concerned about hanging onto the baubles of office than the tens of thousands of youth who want/need a job. I just shake my head in disbelief.

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  32. Anthony (796 comments) says:

    Actually some people already get only around $2 an hour for delivering flyers – they class them as contractors and not employees therefore avoiding the minimum wage rule.

    It is silly to make employers pay $13 an hour to school kids for collecting trolleys at the supermarket, etc.

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  33. Luc Hansen (4,573 comments) says:

    Viking2

    You really are a slimy piece of trash ain’t you.

    Ah, my comment the other day, what was it…white trailer park trash? Get under your skin, darling? You know what they say, if the cap fits…

    Tell you what, why don’t YOU be a real man and post under your real name like I do!

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