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Minimum Wage: expect more increases

Michelle Thompson, CA

May 28, 2021


With the minimum wage having recently increased to $20, you might be thinking that it won’t go up again for a while. But in fact you should probably plan for the minimum wage to keep rising.

In 2000, New Zealand’s minimum wage was $7.55. Since then it has increased every year, under both National and Labour governments, sometimes by as little as 15 cents (in 2001), or by as much as $1.20 (in 2019).

Costs are increasing


Even if you don’t employ one of the 175,000 Kiwis who earn minimum wage, this may impact your business. Wages rise steadily over time, and employees who missed out on a pay rise this year will proba​bly expect one next, if your business has been thriving.


In addition to the rising cost of labour, inflation is forecast to put upward pressure on everyday items. That will likely increase your general running costs and the price of materials. Petrol prices are up, for instance, and supply chain issues have driven up the cost of many imported products.

Meet with us to discuss your plan and budget

Time to review your pricing

Is it time to put your prices up? Ideally, your business should increase costs by a tiny amount each year, rather than by a big jump every five years, for instance. Small increases help prevent price shocks for customers, and keep your business in line with the rest of the market.


Can you also cut costs?

If you don’t think increasing your prices is an option, or you still need to make more of a change, you may need to cut back your spending. We look at your business line by line, so we can help you identify areas where you might be able to trim the fat.


Give us a call or drop us a note – we’re here to help.

Michelle Thompson, CA

Head of Tax & Compliance

Lynch & Associates Limited, Auckland, NZ

Get in touch

Email

Phone: 09 366 6005

Schedule a meeting with Michelle

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