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New Zealand Income Survey: June 2014 quarter
Embargoed until 10:45am  –  03 October 2014
Commentary

All income changes in this information release are statistically significant unless otherwise specified.

All income figures in this information release refer to gross (before tax) income for individuals.

Overview

Between the June 2013 and June 2014 quarters:

Income from all sources: Median weekly income from all sources, for all people, increased by $25 (4.3 percent) to $600. This was partially due to more people receiving income from wages and salaries and fewer receiving income from government transfers.

Wage and salary income: Median weekly income from wages and salaries (for people receiving income from this source) increased by $19 (2.3 percent) to $863, while average weekly income from this source increased by $29 (3.0 percent) to $991 due to more people being in full-time employment.

Average hourly earnings increased by 78 cents (3.0 percent) to $26.78 due to changes in the minimum wage and the number of full-time workers, while median hourly earnings showed little change, up 36 cents (1.7 percent) to $21.94.

Government transfer income: Fewer people received income from government transfers mainly due to fewer women (down 22,500 or 3.2 percent) receiving this income.

See Definitions for more information on the terms and concepts used in this release.

More wage and salary earners contribute to increase in income from all sources

Between the June 2013 and June 2014 quarters, median weekly income from all sources for all people (including those with no source of income) increased by $25 (4.3 percent) to $600. This was the largest annual increase since the June 2007 quarter.

Graph, median weekly income from all sources for all people, June quarter 2005 to 2014.

Contributing to the increase in median weekly income from all sources were more people receiving income from wages and salaries and fewer people receiving income from government transfers.

Graph, People receiving wage and salary income, June quarter 2008 to 2014. Graph, People receiving government transfer income, June quarter 2008 to 2014.

These changes increased median weekly income from all sources as income received from wages and salaries is typically higher than income received from government transfers.

These changes were also seen at the household level, with more households receiving income from wages and salaries and fewer households receiving income from government transfers. This resulted in median weekly household income from all sources increasing by $64 (4.7 percent) to $1,422.

More full-time workers increase weekly wage and salary income

Between the June 2013 and June 2014 quarters, the following changes occurred for those receiving income from wages and salaries.

  • Median weekly income from wages and salaries increased by $19 (2.3 percent), to $863 (not statistically significant).
  • Average weekly income from wages and salaries increased by $29 (3.0 percent) to $991.
  • 94,500 (5.0 percent) more people received income from wages and salaries.

Contributing to the increase in median and average weekly wage and salary income (for those receiving income from this source) was a change in the distribution of this income. Compared with the June 2013 quarter, the number of people earning above $720 a week increased more than the number of people earning less than $720 a week. This figure was the boundary between the second and third quintile in the June 2013 quarter, as shown on the following graph.

Graph, Wage and salary earners by wage and salary weekly income quintile, June quarter 2013 and 2014.

The change in the distribution resulted from a greater increase in the number of full-time workers, up 70,500, than part-time workers, up 20,200. This affected weekly wage and salary income because people in full-time employment typically earn more than people in part-time employment.

In the June 2014 quarter, median weekly income from wages and salaries (for those receiving income from this source) for people in:

  • full-time employment was $989
  • part-time employment was $300.

These changes were in line with other labour market statistics.

For example, the Quarterly Employment Survey: June 2014 quarter showed the strongest annual growth in full-time jobs (in the year to the June 2014 quarter) since the year to the September 2004 quarter.

In the year to the June 2014 quarter, the New Zealand Income Survey also showed increases in median weekly income from wages and salaries for the following subgroups:

  • women – up $29 (4.0 percent) to $739
  • Māori – up $33 (4.3 percent) to $800
  • European – up $34 (3.9 percent) to $900.

No other subgroups showed statistically significant increases.

Little change in median hourly earnings

Median hourly earnings for those receiving wage and salary income were up 36 cents (1.7 percent) to $21.94, between the June 2013 and June 2014 quarters. This movement was not statistically significant.

While median hourly earnings showed the smallest change since the June 2000 quarter, average hourly earnings increased by 78 cents (3.0 percent) to $26.78. The greater increase in average hourly earnings compared with median hourly earnings was due to two key factors.

  • The 50 cent minimum wage increase, from $13.75 to $14.25, which came into effect on 1 April 2014. This increase for people earning the minimum wage helped push up average hourly earnings. However, it did not affect median hourly earnings because the minimum wage lies below the median.
  • A statistically significant increase in the number of full-time workers, up 70,500. This increased average hourly earnings but had little effect on median hourly earnings because the number of part-time workers also increased, up 20,200.

Although there was little change in median hourly earnings for all wage and salary earners, there was an increase for the 15–19-year age group, up 65 cents (4.7 percent) to $14.40.

The wholesale trade industry showed an increase in median hourly earnings, up $2.09 (9.6 percent) to $23.97. No other industries or occupations reported statistically significant increases.

Fewer people receive government transfer income

The number of people receiving income from government transfers fell by 30,700 (2.6 percent). This was driven by a statistically significant decrease in the number of women receiving income from government transfers, down 22,500 (3.2 percent).

Despite the overall decrease in the year to the June 2014 quarter, there was a statistically significant increase in the number of people aged 65+ receiving government transfer income, up 17,900 (3.1 percent). This was in line with an increase in those aged 65+ in the working-age population, up 22,500 (3.8 percent). Median weekly income from government transfers for people in this age group increased by $6 (1.8 percent) to $320.

Between the June 2013 and June 2014 quarters, median weekly income from government transfers (for those receiving income from this source) increased $3 (1.2 percent), to $303, although this was not statistically significant. 

From 1 April 2014, the rate of New Zealand Superannuation increased by 2.66 percent; main benefits, student allowances, and some supplementary assistance increased by 1.38 percent.

For more detailed data, see the Excel tables in the 'Downloads' box.

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