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Aussie salaries rise but not fast enough

Aussie pay packets are rising but experts say early warning signs of a slowdown in wage growth are showing.

Eliza Bavin
·Personal Finance Editor
Updated ·2-min read
People walk the streets of Sydney and a person removing $50 notes from a wallet to represent salaries.
Aussie salaries are rising, but still not enough to keep up with inflation. (Source: Getty)

Aussie salaries rose 4.7 per cent over the year to December 2022, up from 4.5 per cent in November, according to the SEEK Advertised Salary Index (ASI).

The ASI measures the growth in advertised salaries for jobs posted on SEEK in Australia. The report examined national trends up to the month of December 2022.

Advertised salaries grew by 0.3 per cent in the month of December, down from the 0.5 per cent recorded in November.

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SEEK senior economist Matt Cowgill said this could be a sign salary growth may have reached as high as it will go.

“The month-on-month gains in advertised salary slowed a touch in December, falling from 0.5 to 0.3 per cent. This is the slowest month-on-month rise since April and may be an early sign that advertised salary growth is moving away from its peak,” Cowgill said.

“However, advertised salaries are still growing at the fastest annual pace on record, rising by 4.7 per cent over the year, based on SEEK ASI data dating back to 2016. This has been fed into by the tight labour market – with unemployment near a 50-year low – creating a bidding war for talent, as well as the rising cost of living driving salaries up.”

Pay vs inflation

Inflation jumped 7.8 per cent over the year to December, which was higher than many economists had predicted but just short of the Reserve Bank’s previous 8 per cent forecast.

Canstar analysis found the average worker earning $92,030 would have needed a $7,178 pay rise to keep pace with inflation over the past year.

Canstar editor-at-large and money expert Effie Zahos said Aussies could typically get a higher wage by changing jobs.

“Applications per job ad picked up in November through to December by 10.4 per cent, according to SEEK, which indicates Aussies are looking at making a career move in 2023,” Zahos said.

“If a pay rise isn’t on the cards then more households may have to consider a side hustle to cover the inflationary shortfall this year.”

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