Two pairs of shoes. A winter coat. A bed you do not have to share on a cold night. For 170,000 New Zealand children, these are things that belong to other people. Last month, the government released its latest report on child poverty. The Ministry of Social Development should be applauded for producing such careful analysis of a complex issue. But the conclusion is simple: in each of the past two years, that number has grown. We now have around one in seven children living in poverty. Our rate of child poverty is now higher than that found in Lithuania, Latvia, Italy, Portugal, and Cyprus.
Child poverty does not arrive like the weather. It is made, and unmade, in the labour market. When the labour market is strong, jobs are secure, and incomes rise faster than inflation it becomes easier to reduce child poverty. Right now, we are heading in the opposite direction. Labour-market data is a leading indicator of future child poverty. The longer decent jobs and wages are hard to come by, the more child poverty we bake in. The more child poverty we allow, the more it costs all of us to manage later.
Late last month, StatsNZ released three data points. Individually, they might interest only economists. But together, they paint a clear picture of an economy, and a country, that is far from being on track. They show a country at risk of going backwards. They echo what our members tell us every week: the pay rise that did not come, the hours that were cut, the workmate who was never replaced.
The first measures what it actually costs to live here. The Household Living-costs Price Index shows living costs rising at 3.2 percent a year. Since the election and broken down by household, the picture is sharper. Inflation for the poorest 20 percent of households has risen by 9.5 percent. For the richest 20 percent, it has risen by only 5.7 percent. Being poor in New Zealand costs more.
The second counts who is actually in work - the Monthly Employment Indicator. Since the election, there have been 40,924 fewer filled jobs, a loss of roughly 40 jobs a day. The losses fall hardest on workers aged 15 to 24 - the school leavers and graduates trying to get a foot in the door. The annual value of wages earned across the economy has fallen behind inflation by around $1.5 billion since the election. Fewer jobs. Smaller pay packets.
The third counts businesses - the Business Counts Indicators. It tracks what are euphemistically called 'entries'(new businesses) and 'exits' (business closures). Under this Government, 11 percent more businesses close each month, on average, than under the last. When working people earn less, businesses feel it first - and their workers feel it next.
Despite what you might read in newspapers or hear from talking heads on the radio, this is a tough economy for workers. The labour market is harder to get into and harder to stay in. The number of people out of work for six months or more has risen from 25,875 to 64,350. Last year, over 4 in 10 workers got no pay rise at all, and 7 out of 10 workers saw their pay fall behind the cost of living.
News stories show this every day. Last month, it was a Papatoetoe school camp closing because parents could not afford the fee. Then it was social workers warning that children in rural areas are missing school because their parents cannot afford the fuel to get them there. In a strong economy these stories should be getting rarer, not more common. Yet here we are, not even three months after another Budget in which we were told that just one more round of cuts to jobs and investment would solve our problems.
We are now less than 80 days until the next election. Soon, we will be bombarded by promises that recovery is just around the corner - just as it was supposed to be in 2024, and again in 2025, and again this year. But the data tells us what working people have told us repeatedly - that for too many Kiwis and their families, their quality of life has gone backwards. Any recovery that does not include them is not real - it is neither fixing the basics nor building the future. It only locks in another year of children going without a winter coat, a second pair of shoes, and a bed of their own.
Sandra Grey
NZCTU Te Kauae Kaimahi President
