RNZ reports that soaring bills are forcing households to freeze their spending. Here's the uncomfortable truth buried in the wage data: your pay packet might look bigger, but you're running to stand still.

Total wages and salaries hit $22.5 billion in 2024, up from $21.8 billion the year before. (Source: Stats NZ (LEED), taxable-income-sources) Sounds good. Except inflation since 2019 has run at roughly 20 to 25 percent. That means most of the nominal wage growth you've seen in your bank account has evaporated before you've paid the power bill.

Let's rewind. In 2020, the wage bill sat at $21 billion. By 2024, it reached $22.5 billion: a 7.1 percent increase over four years. But prices rose faster. Much faster. The result? Real purchasing power for the average worker has barely budged, and in many cases has fallen.

This is why the household spending freeze makes sense. When your wages climb 7 percent but your costs climb 20 percent, you're not getting ahead. You're making cuts. The data shows wage growth; your grocery bill shows something else entirely.

The contrast gets sharper when you look at 2021. That year, total wages actually fell to $20.6 billion as COVID lockdowns bit. We've since recovered that ground and then some in nominal terms. But inflation wiped out the victory lap. Workers today are earning more dollars that buy less stuff than those dollars did in 2020.

Here's the kicker: these figures are taxable wages and salaries only. They don't capture the self-employed, contractors, or gig workers operating outside PAYE. For those groups, the picture is murkier. But for the bulk of New Zealand's workforce pulling a regular wage, the story is clear. Your payslip grew. Your standard of living didn't.

The political conversation around wages often fixates on nominal growth: ministers tout percentage increases, unions demand more. But none of it matters if prices outpace pay. The $22.5 billion figure looks impressive in isolation. Put it next to inflation and it's a different story.

So when you read about households putting spending on ice, understand this isn't about caution or pessimism. It's arithmetic. Wages rose 7 percent. Costs rose 20 percent. The difference is the money you don't have to spend on anything except keeping the lights on and food in the fridge.

The headline number says workers are doing better. The real number, adjusted for what those wages can actually buy, says something much closer to treading water.