24 Jan 2011

Push for wage increases expected by unions

5:22 pm on 24 January 2011

Unions say they expect low and middle-income workers to push employers strongly this year for big wage rises.

The Council of Trade Unions says rising food and fuel prices will be behind the demands, because many workers aren't being helped by New Zealand's export-led economic recovery.

The price of oil has been heading towards $US100 dollars a barrel on world markets and food prices are at record levels internationally.

But Goldman Sachs economist Philip Borkin says high wage demands could put further pressure on the budgets of households where people miss out on a wage increase.

He says higher home-grown inflation could push the Reserve Bank into early interest rate rises.