Workers out of pocket

Real wages are plummeting but the costs of living are skyrocketing Anthony Albanese

HOUSEHOLD budgets will feel the extra pain of higher fuel, electricity and rental prices economists have warned, after wages rose less than half the rate of inflation.

Wages grew at an annual rate of 2.4 per cent as of the March quarter, compared to inflation surging 5.1 per cent, according to figures released by the Australian Bureau of Statistics on Wednesday.

The effective 2.7 per cent real wage decrease is expected to keep the issue in sharp focus in the final days of the election campaign, dominated by debate on how to ease cost-ofliving pressures.

AMP chief economist Shane Oliver said the low wage rise was “not great news for Australians”, though “not particularly surprising”. “Wages growth has been very weak for a while now,” he said.

But Mr Oliver said with jobless figures on Thursday expected to be as low as 3.9 per cent, it should only be a “matter of time before wages pick up”.

He said households would struggle to afford basic goods and services in the meantime, with government supports in the short term clearly “not enough” to cover rising costs.

“Real growth is going to be a way off,” he said. “The inflation rates are going to get worse before they get better.

“Rents are skyrocketing, we are hearing whispers of electricity prices going up, fuel prices have surged and supermarkets tell us more price rises are on the way.”

Anthony Albanese seized on the latest data to highlight Labor’s argument that wages were taking a huge “hit” under the Coalition.

“Real wages have gone backwards yet again,” the Opposition Leader said. “This delivers the biggest cuts to real wages in more than 20 years.

“Real wages are plummeting but the costs of living are skyrocketing.”

Mr Albanese again held up a $1 coin to highlight the hourly increase to the lowest-paid workers Mr Morrison had refused to endorse.

“(Mr Morrison) started the week by arguing that the workers who carried our economy through the pandemic and went out to work, risking their health to serve others for just $20.33 an hour, didn’t deserve an additional $1,” he said.

The Fair Work Commission is reviewing the national minimum wage, and is due to hand down a decision later in the year.

Mr Morrison blamed international pressures such as the war in Ukraine and supply chain disruption for Australia’s cost-of-living crisis, arguing inflation was outside his control.

He said Mr Albanese did not “have a magic pen” to make pay “go up”.