Labour Cost Index (All Labour Costs) - December 1998 quarter and March 1999 quarter
Declining Non-wage Labour Costs
Each of the surveyed non-wage labour costs fell from the March 1998 quarter to the March 1999 quarter, said Deputy
Government Statistician Ian Ewing. The overall decrease in non-wage labour costs for that period was 3.3 per cent.
The employer cost of superannuation and accident compensation premiums made the largest contributions to the 3.3 per
cent drop in costs from the March 1998 quarter. Compared with a year earlier, superannuation costs were 8.2 per cent
lower due to sizeable reductions in the employer contribution rates for public sector employees and the employer cost of
ACC was 6.9 per cent lower caused by premium decreases last year for the majority of industries.
Compared with the March 1998 quarter, total labour costs were 0.9 per cent higher for the March 1999 quarter. The
increase in salary and wage rates of 1.7 per cent from the March 1998 quarter to the March 1999 quarter was partially
offset by falls for each of the surveyed non-wage labour costs.
The other non-wage labour costs index, including medical insurance, motor vehicles available for private use and
employment-related low interest loans, fell by 5.1 per cent from the September 1998 quarter to the December 1998
quarter, and it decreased a further 0.9 per cent for the March 1999 quarter. The various factors driving down these
costs in recent quarters include falling vehicle prices, the removal of the last remaining vehicle import tariff, lower
medical insurance premiums as a result of fewer claims being lodged and decreases in the prescribed interest rate which
is used to calculate the fringe benefit value of low interest loans.
Whilst total labour costs increased by 0.9 per cent between the March 1998 and March 1999 quarters, the costs of other
business inputs as measured by the Producers Price Index fell by 0.2 per cent, over the same period, and consumer prices
fell by 0.1 per cent.
DEPUTY GOVERNMENT STATISTICIAN
30 August 1999