Labour Cost Index and Quarterly Employment Survey: March 2006 quarter
Embargoed until 10:45am — 8 May 2006
Annual Wage Growth Continues
Salary and wage rates (including overtime), as measured by the Labour Cost Index (LCI), rose 3.3 percent in the year to
the March 2006 quarter, Statistics New Zealand said today. This is the largest annual increase since the series began in
the December 1992 quarter. Strong earnings growth was also shown in the Quarterly Employment Survey (QES) over the March
2006 year.
In the year to the March 2006 quarter, salary and wage rates (including overtime) increased 4.0 percent for the public
sector, and 3.0 percent for the private sector. These are the largest annual increases since the LCI began in the
December 1992 quarter.
In the year to the March 2006 quarter, 61 percent of salary and ordinary time wage rates in the surveyed sample
increased. Twenty-five percent of these recorded an increase of between three and five percent, and 21 percent an
increase of more than five percent. These are the largest annual proportions since the LCI began in the December 1992
quarter.
In the QES, the average total hourly earnings increased 5.2 percent (to $21.63) in the March 2006 year. This is the
largest March annual increase since the year to March 1990.
The number of full-time equivalent employees (FTEs) rose 3.1 percent over the March 2006 year, driven by increased
full-time employment (up 3.7 percent). Part-time employment was relatively unchanged over the same period.
The QES average earnings statistics reflect not only changes in pay rates, but also compositional and other changes in
the paid workforce. By comparison, the LCI measures changes in salary and wage rates for a fixed quantity and quality of
labour input.
Brian Pink Government Statistician
ENDS