Annual wages growth has hit its highest levels in almost 15 years, after significant pay rises for award wage earners and aged care workers came into effect.
The wage price index, which measures pay rates for a basket of representative jobs, accelerated to 4 per cent in the year to September, up from 3.6 per cent in the 12 months to June, the Australian Bureau of Statistics said on Wednesday.
On a quarterly measure, wages grew 1.3 per cent in the three months to September, the highest ever recorded in the index’s 26-year history.
However, in wages growth is still languishing behind the 5.3 per cent seasonally adjusted inflation reading for the year to September, implying a 1.3 per cent pay cut.
Ahead of the release, economists said the latest wage price report was unlikely to force the Reserve Bank to lift interest rates at its final meeting of the year on December 5, as the central bank awaits further inflation data due before its February meeting.
Economists expect the strong jump in pay packets to be a one-off due to the Fair Work Commission’s decision to increase minimum wages by 8.6 per cent and award wages by 5.75 per cent, effective from July 1. The determination affected about 3.1 million workers.
An increase to the wages of 250,000 aged care workers also pushed up pay slips this quarter.
More to come.