How pay packets will grow –
W AGES in South Australia are on the brink of surging, driven by the mining and defence boom which has pushed wages higher in other states.
The state’s average weekly wage had the third slowest growth in the past 15 years of 64.3 per cent while the pay packets of workers in resource-rich states Western Australia, Queensland – and Northern Territory – surged by up to 91.1 per cent.
Queenslanders went from being the second lowest earning workers in Australia to the fourth highest earning, while West Australians soared from the middle of the pack to be the second highest earning workers. Australian Bureau of Stat- istics figures show South Australian workers on average take home more than $100 less each week, or $842.90 (pre tax), than the other three mining states.
South Australians now take home the second lowest weekly pay packet in the nation, compared with the third lowest wage in 1995.
Economists, however, predict increased mining and defence activity will cause wages to rise in coming years as it has in other states.
Prescott Securities chief economist Darryl Gobbett says SA’s wages always have tended to be lower than the national average but there is a change under way with the state’s major industries. He says the state has relied on manufacturing and now is more service-oriented.
Manufacturing itself will change to provide equipment for mining and defence and service industries will become stronger, he says.
‘‘I think South Australian employers need to get used to the idea – both with structural changes in the economy and demographic changes that are affecting us – that the relative wages growth is going to be stronger than they are used to in the past,’’ he says.
‘‘SA will catch up to eastern state’s wages. ‘‘That’s part of the process.’’ BIS Shrapnel chief economist Frank Gelber last month told an Economic Outlook Briefing conference in Adelaide that Western Aus- tralia and Queensland had had their mining investment booms. This yet was to occur in SA. The expected expansion of the Olympic Dam mine in the state’s Far North will create jobs for about 10,000 workers directly at the site.
Work could be under way from 2012.
Mr Gobbett says SA has had an older population, with more retirees and workers nearing retirement age taking on less hours, but they still spent money on goods and services.
Combined with a local workforce which is not as educated or trained as in other states, this also has contributed to a lower average wage.
Specialised workers will be required to fill the mining jobs and
many will have to come readytrained and skilled, from either interstate or overseas.
As more people receive the high wages in mining, the state’s average wage will increase.
More people, however, will be needed in other industries to cater for associated business with mining and defence.
Skilled workers will demand higher premiums, Mr Gobbett says.
‘‘The legal sector experienced a surge in the number of people employed from 2006 to 2008 because as new mining companies were formed, they were needed to service the business,’’ he says.
‘‘Commercial property is doing well as mining companies start up and the housing industry here also has held up very well because we have got these people coming in from overseas from skilled workforce areas.
‘‘Often the average may reflect people coming into South Australia to fill these particular jobs.’’
He says employment consultancy is also a growth area because of the structural changes that are under way in industries.
More retail, health, hospitality and education workers will be needed as the population grows, such as when an army battalion sets up at Adelaide’s Edinburgh RAAF base next year.
The spin-off jobs created could be much greater than the actual number of jobs directly associated with a major project.
Mr Gobbett says wages in these sectors also will need to rise to ensure demand is met and quality staff are employed.
Workers in the Australian Capital Territory took home the nation’s highest average weekly wage of $1106.20 a week because of its high proportion of top-level public sector staff.
ACT workers also were the nation’s biggest earners in 1995.
West Australians closely follow as the second highest earners, with an average of $1018.30 a week.
Tasmanians had the lowest wage growth of 55.1 per cent.
They earn the lowest wage of $778.00 a week.
NSW workers were the second highest earners in 1995 but now earn the fifth highest average weekly wage of $958. The national average weekly wage is $938.