Police and teachers are currently receiving the lowest rates compared to minimum or average wages in at least 20 years.
Infometrics economists have analyzed the figures for the wages of teachers, nurses and police.
Earlier this year, chief forecaster Gareth Kiernan had noted that MPs were receiving their lowest salary compared to the average since the 1970s, before their latest pay rise.
The data showed that wages in all three sectors were also relatively lower than in the past across a range of measures.
“Compared to historical norms, police salaries look particularly bad, and teachers don't look very good either,” Kiernan said.
“Nurses don't seem to be that bad, although recent figures have been inflated by the pay parity scheme. If you exclude that from the figures, based on the fact that nurses were previously underpaid because it was a female-dominated profession, then their pay isn't great either.”
For police, the lowest pay for a sworn officer was $75,063 – the lowest level since 2007 compared to the CPI.
Compared to average wages, it was at the lowest point since 2003 and possibly since 1969. It was 41 percent lower than the highest point in 1981.
Compared to the minimum wage, it was lower than at any time since 2003 and possibly since 1967. It was 63 percent lower than in 1981.
Police officers have been involved in a pay dispute, but a new pay offer was expected to be confirmed by the end of August.
Kiernan said secondary school teachers' earnings relative to the CPI were the lowest in June last year – just before their last pay rise – since 2006.
The Post-Primary Teachers Association (PPTA) said most of its teachers were paid at the top of the pay scale, which was $99,216 a year, rising to $103,085 in December.
“Over the longer term, teacher salaries have remained fairly stable compared to the CPI, and the pay increase coming into effect from December this year should push inflation-adjusted wages to levels higher than ever before. time between December 1986 and June 2020,” Kiernan said.
“That outcome sounds great for teachers, but when we compare teacher wages to the average wage or minimum wage, it's a different story. In June 2023, teacher pay relative to any of these variables was the lowest on record. since 1980. Even with the subsequent wage increases that have occurred and/or will occur in December of this year, teacher salaries relative to the average wage or minimum wage will still be lower than at any time prior to June 2019.”
He said the pay situation for teachers could lead to bigger problems.
“New Zealand's poor education outcomes and persistently poor productivity outcomes, combined with wage rates continuing to decline relative to other wages, could potentially become something of a chicken-and-egg problem.
“You can't expect good educational outcomes without good teachers, but good people also won't be attracted to the profession or retained as teachers without good pay – and primary and secondary education doesn't seem to be an area of capital investment. equipment, automation or economies of scale will have a significant positive impact. Of course, there are other big issues, such as curriculum, assessment methods, and the incentives to teach based on the average student's abilities rather than taking one more. approach tailored to students' needs.”
Kiernan said that before pay parity that started in 2021, nurses' wages were at the lowest level compared to the minimum wage in all available data.
“The pay equity increase pushed nurse wages to their highest level ever in 2022, compared to average wages. But compared to the minimum wage, it was only at its highest level since 2016.”
The listed nursing pay was $75,773.
“I wonder if one of the key aspects of each of these professions is that there is limited scope for improved labor productivity and/or greater capital intensity,” Kiernan said.
“At its simplest, a teacher can only achieve significant 'productivity improvements' by having more students per class; a nurse by having more patients under their care; a police officer by covering a larger area. I can imagine how advances in technology might have made some of these changes possible: for example, electronic patient monitoring would require less human supervision of patients in the hospital.
“But my impression is that progress will have been more limited than in many other professions, where computers have had a significant impact on people's output over the past 40 years,” he said.
“As a result, average wages at an economy-wide level may have risen faster as people have been more productive, and the mix of jobs in the economy has also changed towards higher-skilled and better-paid jobs. This trend may have meant that specific professions with a high human element have fallen slightly behind in relative terms in terms of wages.
“It's a difficult situation because as we've seen during Covid-19, people seem to implicitly value the human nature of those roles when the going gets tough – but pay rates don't necessarily reflect that.”