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Millions of Aussies set for major pay rise

·Personal Finance Editor
·2-min read
People walk on a busy street in the CBD and Australian currency to represent that workers could be in for a pay rise.
Aussies on the minimum wage could see a pay rise as soon as next month. (Source: Getty)

Millions of Australians on the minimum wage are expected to get a pay rise next month, according to new research.

ANZ has predicted the Expert Panel of the Fair Work Commission (FWC) will award a 4-4.5 per cent nominal increase to the national minimum wage.

This would be the largest percentage increase since 2010, when wages rose sharply following a freeze in the wake of the Global Financial Crisis.

“ANZ research thinks the Fair Work Commission will recognise the need for some ‘catch-up’ for minimum and award-wage earners after two small increases in the past two years during the pandemic,” the ANZ research said.

However, this hike in the minimum wage would still be less than the rising cost of living and would still amount to a cut in ‘real wages’.

Real wages are calculated by comparing the rise in wages to the rise in inflation. So, if there has been a rise in inflation larger than the rise in wages, real wages have fallen despite the lift.

It is estimated more than 2 million Australians are on the minimum wage.

Albanese backs wage rise

Prior to winning the federal election, Prime Minister Anthony Albanese backed a rise in the minimum wage, potentially giving millions of Aussies a pay boost.

Albanese said he backed a rise in the minimum wage of at least 5.1 per cent to keep up with rising inflation.

However, it is not the Prime Minister who determines the minimum wage.

Every year, the Fair Work Commission convenes a panel of experts to review the figure.

The panel considers a range of sources and materials, including written submissions from organisations and individuals, consultations with industry experts, and a range of papers, research and studies.

At the end of the commission’s review, a national minimum wage order is made.

This new minimum wage will apply from the first full pay period after July 1 each year.

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