Low wage growth is ‘new black’ for work­ers

Daily Mercury - - BETTER BUSINESS NEWS - — Melissa Jenk­ins

WORK­ERS are still get­ting used to the ‘new black’ of wages growth, which is run­ning at just two per cent a year, a lead­ing econ­o­mist says.

Wages rose by just 0.5 per cent in the three months to Septem­ber 30 as the quar­terly wage price in­dex the pre­ferred mea­sure of wages growth for both the Reserve Bank of Aus­tralia and Trea­sury - missed mar­ket ex­pec­ta­tions.

Economists had fore­cast a 0.7 per cent bump for the quar­ter and an an­nual rate of 2.2 per cent.

Com­mSec chief econ­o­mist Craig James said this would or­di­nar­ily be a pos­i­tive re­sult given wages are still out­pac­ing prices.

“But wage earn­ers are still ad­just­ing to the ‘new black’ of wage growth near two per cent rather than 3.5-4.0%,” he said. “Wages are grow­ing at a slower pace be­cause glob­ally chal­lenged busi­nesses are re­luc­tant to lift prices on the fear of los­ing sales.”

Work­ers in the ac­com­mo­da­tion and food ser­vices in­dus­tries had the high­est quar­terly rise of 1.7 per cent, while min­ing com­pany em­ploy­ees saw their pay pack­ets inch up by just 0.2%, ac­cord­ing to Aus­tralian Bureau of Statis­tics data re­leased on Wed­nes­day.

In the pub­lic sec­tor, pub­lic ad­min­is­tra­tion and safety had the strong­est quar­terly growth of 1.2 per cent, while work­ers in elec­tric­ity, gas and wa­ter were among those with the low­est in­crease of 0.5 per cent.

The Aus­tralian dol­lar plunged af­ter the fig­ures were re­leased, div­ing as low as 75.77 US cents at 1306 AEDT, af­ter trad­ing at 76.29 US cents just be­fore the re­lease. Ear­lier this year, the Fair Work Com­mis­sion awarded Aus­tralia’s 2.3 mil­lion low­est paid work­ers a 3.3 per cent wage rise, which equates to $22.20 a week and was the largest in­crease in six years.

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