Australian youth rates

October 18th, 2012 at 12:00 pm by David Farrar

David Shearer said on the starting out youth rate:

Labour Party leader David Shearer criticised the move, saying “it’s not going to create jobs by driving down wages”.

“These people are going to leave and go to Australia,” said Shearer.

Peter George has blogged the rates in Australia:

  • Under 16 years of age  $5.87
  • At 16 years of age   $7.55
  • At 17 years of age   $9.22
  • At 18 years of age   $10.90
  • At 19 years of age   $13.17
  • At 20 years of age   $15.59

The NZ rate is $10.80 and only for 16 to 19 year olds in some circumstances for a limited six months. Can’t really see those 16 year olds going to Aussie for the higher .

Of course what matters is not the minimum wage, but the actual wage paid. So many people seem to think a minimum wage is a maximum wage.

Tags: ,

22 Responses to “Australian youth rates”

  1. Lee C (4,516 comments) says:

    May I ask, were any of these wage rates recently reduced by the Australian Parliament?

    because if not, it doesn’t appear to be (strictly) addressing the same issue.

    That is before we start looking at what people can purchase with the Australian dollar in Australia by comparison to here, and if assistance or incentives are provided to employers or employees and how they might compare with those provided in NZ.

    On top of that, are we missing an opportunity to discuss whether recent immigrants to NZ or Aus are more likely to get employment – and whether they are entitled to additional assistance etc.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  2. David Farrar (1,899 comments) says:

    On wage rates have been reduced by the NZ Parliament. The minimum wage an employer can offer a future employee who is 16 or 17 or 18 and 19 and on a benefit has been set lower. Again people do not understand the difference between a minimum wage and actual wages.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  3. Viking2 (11,488 comments) says:

    No wonder the young ones go.
    There is absolutely nothing wrong with a tiered system like that. Its fair to everyone and allows young people to get started and learn about work.
    Remember that an employer can always pay more and an employee can ask for more.

    Bring this back in NZ instead of discriminating against young people who want to work by making them outrageously expensive..

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  4. Enzo (45 comments) says:

    Almost as bad as when the right claim people will go to Australia for the lower taxes they don’t have.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  5. davidp (3,581 comments) says:

    It’s nothing short of bizarre that Shearer thinks Australian businesses are crying out for unskilled 16 and 17 year old immigrants.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  6. Rick Rowling (813 comments) says:

    May I ask, were any of these wage rates recently reduced by the Australian Parliament?
    because if not, it doesn’t appear to be (strictly) addressing the same issue.

    Because getting paid $5.87 per hour feels like more than $10.80 an hour if the rate wasn’t recently reduced.

    But hey, you got the first response in, points for effort.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  7. dime (9,980 comments) says:

    whats the minimum wage in the US? $7.50 for adults???

    lucky for us we are an economic super power and can afford things like a $13 min wage.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  8. seanmaitland (501 comments) says:

    Enzo – the left are the ones who are always bleating on about people going to Australia – I’ve never heard a “righty” say that they are moving to Australia because its not fair in NZ. The left’s mantra and ideology is all about making out how greedy pricks are the reason that life’s not fair.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  9. MikeG (425 comments) says:

    and of course Farrar’s logic on youth rates doesn’t extend to electricity prices in yesterdays post. “Look at the lowest price”, rather than looking at what people are actually paying.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  10. gazzmaniac (2,307 comments) says:

    Almost as bad as when the right claim people will go to Australia for the lower taxes they don’t have

    I’m on a good salary and I still pay less income tax than I would in NZ, because of the generous tax rates at the bottom – it’s just the marginal rates at the top that are more.

    I think it’s somewhere close to $150k where income tax becomes lower in NZ than Australia.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  11. dime (9,980 comments) says:

    Aussie tax rates:

    0 – $18,200
    Nil

    $18,201 – $37,000
    19c for each $1 over $18,200

    $37,001 – $80,000
    $3,572 plus 32.5c for each $1 over $37,000

    $80,001 – $180,000
    $17,547 plus 37c for each $1 over $80,000

    $180,001 and over
    $54,547 plus 45c for each $1 over $180,000

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  12. gazzmaniac (2,307 comments) says:

    Using Dime’s figures there, and figures from the IRD, you can do a quick excel sheet to find out that the crossover point is at 130,000 if there was no exchange rate issue (AUD=NZD).

    Now if you take the exchange rate into account (at AUD/NZD=1.25 which is generous for NZ, it’s been floating between $1.24 and $1.30 for the last year, but it easy to calculate) the crossover is close to $NZD233,000 or $AUD186,000.

    And for basic stuff like food, especially dairy, it’s cheaper to live in Australia. Depending on where you are, houses are dearer or cheaper (a house in a Gold Coast suburb is about the same price as one in an Auckland suburb, but Sydney is dear). It’s swings and roundabouts regarding the cost of living.

    So Enzo, you have it wrong. You have to be on a very large salary to be paying more income tax in Australia than in New Zealand.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  13. Enzo (45 comments) says:

    You can’t just take income tax, for a fair comparison you have to look at the entire tax regimes of both countries.

    And besides, the point is people take a whole raft of things into consideration when they decide what country to live in. These arguments are always silly.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  14. Lee C (4,516 comments) says:

    “But hey, you got the first response in, points for effort.”

    Yes I did. Well spotted.

    Thank you.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  15. gazzmaniac (2,307 comments) says:

    Enzo, you made a specific claim that taxes in New Zealand were lower than in Australia. You were wrong. Accept it.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  16. Enzo (45 comments) says:

    How am I wrong? Someone has explained how income tax is lower, but that’s not “taxes”. That’s just one tax. Must try harder.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  17. gazzmaniac (2,307 comments) says:

    Taxation Revenue as a proportion of GDP:
    http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP

    Australia as measured by Heritage Foundation (2012) 30.8%
    New Zealand as measured by Heritage Foundation (2012) 34.5%

    Australia as measured by OECD (2008/9) 27.1%
    New Zealand as measured by OECD (2008/9) 31%

    You’re still wrong.

    Incidentally
    Singapore as measured by Heritage Foundation 14.2%
    Hong Kong as measured by Heritage Foundation 13.0%

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  18. Enzo (45 comments) says:

    Mmmmm I don’t think so. As a percentage of GDP is very different to a percentage of people’s real life incomes. The Australian economy is much stronger than ours. Must be something to do with their pinko Labor government. Have another go.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  19. Luc Hansen (4,573 comments) says:

    I have a son who has been working in Australia for about a decade now and he’s always complaining about the taxes, other than income tax, that he pays. But the pay is more than twice what he could earn here, so he’s not complaining too much!

    But hasn’t DPF shot himself in the foot here, with PG’s help, thanks to Dime? So more or less until a kid is 18 in Aussieland, the minimum wage is a b net figure.

    And paying less than adult rate to 18+ year olds is just daylight robbery, a subsidy to employers with the connivance of the government who can discount the votes of such a narrow minority – and a minority who are too busy with their lives to bother organizing against it.

    As I have said on here before, I used to employ youths in the days of youth rates and I just got too damned embarrassed to enforce those rates when the kids learnt so quickly and were so keen and energetic. I ended up just starting everyone on the minimum adult rate, and generally increased their pay above that after three months. Bosses who utilise these rates are just self-interestedly exploiting the young. Shame on them.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  20. gazzmaniac (2,307 comments) says:

    Enzo.
    If Australian’s GDP was lower then there wouldn’t be as much tax revenue. Tax revenue reduces with GDP.

    You are asking me to compare income with tax, which I have done – income tax is lower for incomes in Australia up to about $NZD230k.
    You then ask me to compare the whole economy which I have done.
    What the fuck else do you want? I am not going to spend all night trying to convince somebody with a closed mind that they are wrong.

    Australia’s Labor party has reduced taxes, which is something that National hasn’t done. They are economically to the right of the current New Zealand government.

    You are a moron.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  21. gazzmaniac (2,307 comments) says:

    Luc,
    Employing somebody with no work history or straight off the dole is a big risk. All the governmnet has done is allow potential employers to mitigate that risk, with the view that if a risk isn’t as big then an employer is more likely to employ somebody.

    A minimum wage is not a maximum wage, and if an employer feels that the worker is worth more without proving themselves then they may well offer a higher rate.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote
  22. Left Right and Centre (2,986 comments) says:

    They’re all off to Australia… due to new starting wage making all the difference.

    Bollocks.

    Maybe dumbarse comments like that are part of a much bigger PR campaign that’s aimed towards the great unwashed masses. It’s not aimed at you, educated and enlightened Kiwiblog comment poster, is it?

    It’s not going to create jobs. Well that’s a slightly more plausible theory.

    Has anyone ever commented that David Shearer looks a bit like David Campese or is that just me?

    I like this one: ‘remember, the minimum wage is not a maximum wage’. Yeah, that’s like saying… just because your BMW X5 M50d can do plenty of x speed more than 1×9 doesn’t mean you have to (inside KB joke). Certain employers eyes are spinning around in their sockets like fruit machines and stopping on $……… $. They’re salivating. They’re having pleasant ‘starting wage’ wet dreams. Oooo…. I can’t wait to get those little bastards for $10.80 an hour.

    And can I be one of those twats that says ‘and what if this is only the thin end of the wedge?’. It’s National… so why not? I voted for them but I don’t want the pricks sliding down the slippery slope. I can see it now: ‘Starting wage so successful National drops it to $4 an hour’… you know… gives all the young mongs a taste of working life. Like how to show up and wish you’d never been born. Make the adult minimum wage look like a freakin pot of gold at the end of the rainbow by comparison. Wow…now I’m on $13.50… I’m richau…. I can even afford the KFC quarter pack once a month.

    It’s bloody obvious that a lot of kids jobs will be advertised as $10.80 and if you don’t like it… well there’s stacks of other kids who will take it. Because they too have no real choice.

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote