"The economy grew 0.2 percent in the June quarter, but there is a long way to go before we have dug ourselves out of the hole we have sunk into under this Government", says NZCTU Te Kauae Kaimahi President Sandra Grey.
"GDP per capita basis is still 1.5 percent below where it was three years ago", says Grey.
"Growth has been weaker in New Zealand than our peer countries, Australia, the UK, and the US all growing at twice the rate that we did in the June quarter, and the Euro Area growing at thrice the rate", says Grey.
"There was some growth in construction, which is welcome. But this industry has taken an absolute hammering over the past three years. Compared to the same quarter three years ago, construction output is down almost 10 percent", says Grey.
"Working families have been struggling with the rising cost of living and job insecurity over recent years and this will remain the case over the next year. This has been restricting consumer spending", says Grey.
Household spending on durable goods is still lower than it was in the June 2023 quarter and spending on non-durable goods is flat.
"The growth that we have seen has not been shared evenly. The broad measure of business profits has grown much faster than employee compensation", says Grey.
Annual average growth in operating surplus and mixed income was 7.4 percent while compensation of employees grew just 2.7 percent.
"We have seen a drop in the labour income share over this government's term. This indicates that more of the economic pie has been going towards business", says Grey.
"The GDP results should be read alongside the recent employment, wage, and inflation data", says Grey.
Unemployment has risen to 5.6 percent, and underutilisation to 13.8 percent. Long-term unemployment is up 150 percent since 2023, with around 67,000 Kiwis unemployed for 6 months of longer in the June quarter. Māori and Pasifika communities are experiencing unemployment rates of over 10 percent.
The weak job market is leading to lower wage growth. Annual wage growth for the June quarter was 2 percent on the labour cost index measure and 2.8 percent on the average hourly wages measure. But inflation was 4.1 percent for the same period, meaning wages have been going backwards.
"The job market is in free-fall and working Kiwis are paying the price", says Grey.
"We've had three years of barely any growth, falling real incomes for many households, and rising unemployment and economic insecurity. The Luxon Government has manifestly failed to get New Zealand 'back on track'," says Grey.
"Christopher Luxon's economic plan hasn't worked. It hasn't delivered economic growth. It hasn't delivered a strong job market. It hasn't delivered improved productivity or real wages. We need a different plan", says Grey.
