The Minimum Wage Increase Does Not Bode Well for Hort

By: Christoph Kistler

As a New Zealand orchard management company, we are aware that the recent announcement of the minimum wage increase has caused some concerns for the horticultural industry we serveā€”it may certainly put a cap on growers’ preparedness to try new things and innovate.

While we believe in paying our pickers a fair wage for their hard work, the increase in the minimum wage may hurt small growers who are already struggling to keep their businesses afloat.

With the current weather conditions and supply chain issues, growers are already facing additional costs, and the new policy change adds more pressure on them.

As a tech start-up, we use RFID technology to help growers improve productivity, and fruit quality, meet compliance obligations, and measure picker performance. As a result, we know that the new minimum wage increases will make it more challenging for growers to reinvest their revenue into expanding the industry to meet the government’s goals.

We understand that wages often constitute 60% or more of a grower’s costs in a sector with slim margins, and the wage rises could put some small growers into more debt or push them out of the market entirely.

Furthermore, growers employ many seasonal workers from the Pacific Islands, many of whom are paid the minimum wage. The new minimum wage increases would significantly impact growers’ ability to hire seasonal workers.

Growers will need to be transparent in paying their workers correctly, while workers must be aware of the risk of having no job if they falsify their pick rates. It’s essential to incentivise workers to perform well and compete for the most trustworthy and productive pickers.

We also suggest that growers consider investing in more automation at the orchard level to help trim costs and cope with the wage increases.

Some growers have already been able to halve their picker requirements through automation, which could be a viable option for those struggling to keep their businesses running.

In conclusion, while we support fair wages for our pickers, the new minimum wage increases may hurt small growers and put more pressure on an already struggling industry.

We hope that growers and workers can work together to build trust, incentivise performance, and invest in automation to cope with these challenging times.