New Zealand wage growth ‘worst in the world’ – OECD report
New Zealanders have had some of the worst wage growth in the world in recent years, when adjusted for inflation.
What happened
The OECD released its latest employment outlook research on Tuesday, looking at disparities in jobs and incomes around the world. Australian commentators noted that Australia performed poorly – but this side of the Tasman fared even worse.
The data showed New Zealand had the worst wage growth after inflation over the past five years, of any OECD country.
“Despite persistent annual growth, in Q1 2026, real wages remained below their Q1 2021 levels in about one-third (13) of the 37 countries analysed,” the report said.
Context and Background
“Real wages were more than 2 percent below Q1 2021 levels in a quarter of countries: Australia, Czechia, Denmark, Italy, New Zealand and Sweden. It should be noted that wage recovery is slowing down in most of these countries, with annual real wage growth in Q1 2026 being lower than a year earlier – wage growth accelerated only in Czechia and Sweden.
“Nevertheless, real wages have regained some of the lost ground in virtually all OECD countries – real wages are near the trough of the cost-of-living crisis only in New Zealand and Australia.”
New Zealand’s wages were 6.4 percent below 2021’s in real terms.
Download MP3 14m It said the minimum wage had decreased year-on-year in April in 11 countries, including New Zealand, Australia, the US and Canada.
Analysis
The significance of this story lies in its potential to reshape the current landscape. Experts note that the underlying factors driving this development have been building for some time, and the ramifications could extend beyond the immediate context. Key areas of impact include regional dynamics, market reactions, and policy considerations.
Stakeholders across multiple sectors are assessing their positions in light of this news. The full scope of consequences will become clearer as additional details emerge and official responses are formulated.
Why it matters
Economists said while the picture was grim, it may be being made to look worse by the data being used. It uses the labour cost index (LCI), which shows what employers are paying for certain roles.
Infometrics chief forecaster Gareth Kiernan said it was not the ideal measure for comparison.
Key takeaways
- New Zealanders have had some of the worst wage growth in the world in recent years, when adjusted for inflation.
- The OECD released its latest employment outlook research on Tuesday, looking at disparities in jobs and incomes around the world. Australian commentators noted that Australia performed poorly – but this side of the Tasma
- The data showed New Zealand had the worst wage growth after inflation over the past five years, of any OECD country.
- “Despite persistent annual growth, in Q1 2026, real wages remained below their Q1 2021 levels in about one-third (13) of the 37 countries analysed,” the report said.
What to watch next
Stay tuned for updates as this story develops. Key indicators to watch include official government or organizational responses, market reactions, and any follow-up announcements from the parties involved.