Record Low Rates of Growth in Australian Wages
The Australian Bureau of Statistics (the "ABS") has reported that rates of pay (excluding bonuses) in the private sector are growing at the slowest rate since the ABS began publishing the Wage Price Index in the late 1990s. The Wage Price Index for the March quarter has revealed that rates of pay grew by 2.3 percent annually in the private sector and 2.5 percent in the public sector, compared with the growth rates of 3.2 percent in the private sector that were experienced two years ago. The current figures are the lowest on record.
Modest Increase to Australian Minimum Wage
After completing the Fair Work Commission ("FWC") Annual Wage Review 2014–15, the FWC announced a 2.5 percent increase to the minimum wage, which will take effect from 1 July 2015. The change represents an increase from $16.87 to $17.29 an hour, equating to an increase from the current $640.90 per week to $656.90 per week. This increase is smaller than the increases that have been implemented in previous years.
According to the FWC's Annual Wage Review 2014–15 decision, the FWC had particular regard to the reduction in "aggregate wages growth", along with other factors such as the reduction in inflation. These low rates of growth in wages were discussed in the article above, and according to the FWC, favoured "a more modest increase in minimum wages".
Thanks to associate Michael Whitbread and graduates Talia Calgaro and Stephanie Crosbie for their assistance in the preparation of this Update.