Wages grow 2.6%: Why that’s not nearly enough
Wages grew just 0.7 per cent in the June quarter and 2.6 per cent annually, according to new data from the Australian Bureau of Statistics (ABS).
“After three quarters of consistent wage growth, driven mostly by wage rises across the private sector, the annual rate of growth was 2.6 per cent,” ABS head of prices statistics Michelle Marquardt said.
“This is the highest annual rate of wages growth since September 2014.”
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Private sector wages rose 0.7 per cent over the June quarter, with the public sector rising by 0.6 per cent.
Annually, private sector wages (up 2.7 per cent) rose more strongly than public sector wages (up 2.4 per cent).
The public sector has a large proportion of jobs paid under multi-year enterprise agreements, which tend to be less reactive to labour market conditions, the ABS said.
Those in the construction industry saw the biggest increase, with wages rising 1.4 per cent for the quarter.
However, those working in the food industry saw the weakest wage growth, coming in at 0.1 per cent.
Wages growth not enough
Despite the uptick in wages growth, the cost of living soared 6.1 per cent in the June quarter.
So, comparing the growth in wages to the higher cost of goods, Aussie workers actually saw a real wages decline of 3.5 per cent.
A combination of rising interest rates and inflation has put increased pressure on household budgets, with many struggling to keep up.
The Reserve Bank of Australia (RBA) has predicted that Aussies are likely to take a real wage cut until at least 2024.
Workers will also be stung with domestic retail, gas and electricity prices expected to increase by 10-15 per cent over the second half of 2022, according to the RBA, on top of steep rises in mortgage repayments.
Australian Council of Trade Unions president Michele O’Neil said Aussie workers had waited too long for a wage boost.
“June 2024 for real wage growth is too long to wait … the Albanese Government needs to act with urgency,” O’Neil said in a statement earlier this month.
“This is no ‘wage-price’ spiral that the business lobby argues. This is a downward spiral for the living standards of working people.”
O’Neil said workers in Australia currently had the lowest share of GDP in history.
“This is no accident,” she said.
“The previous Coalition government had low wages as a ‘deliberate design feature’ of the Australian economy, enabling corporate greed to flourish.
“It’s critical that the Albanese Government reform our bargaining laws to deliver wage growth.”
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