- New data from the Australian Bureau of Statistics (ABS) shows Australian wages grew steadily over 2021 but were still heavily outpaced by inflation
- The ABS’ seasonally adjusted Wage Price Index (WPI) rose 2.3 per cent annual over 2021 — well behind the 3.5 per cent growth in the Consumer Price Index (CPI)
- Still, ABS Head of Price Statistics Michelle Marquardt says the proportion of pay rises reported over the December quarter was higher than usually seen at this time of year
- Tasmania recorded the highest rate of annual growth, at three per cent, while WA came in last at just two per cent annual wage growth for the full year
- At an industry level, the accommodation and food services sector saw the largest annual increase in hourly rates of pay at 3.5 per cent
New data from the Australian Bureau of Statistics (ABS) shows Australian wages grew steadily over 2021 but were still heavily outpaced by inflation.
The ABS’ seasonally adjusted Wage Price Index (WPI) rose 0.7 per cent in the December quarter of last year, taking the annual growth rate to 2.3 per cent — a comfortable increase on the record low of 1.4 per cent recorded towards the end of 2021.
However, with the latest inflation data showing a 3.5 per cent increase in the Consumer Price Index (CPI), wages are still lagging behind prices in terms of growth.
Still, Head of Price Statistics at the ABS Michelle Marquardt said the proportion of pay rises reported over the December quarter was higher than usually seen at this time of year.
“The implementation of the last phases of award updates and state-based public sector enterprise agreements, on top of a rising number of wage and salary reviews, drove wages up 0.7 per cent over the quarter,” Ms Marquardt said.
She said wage pressure continued to build for jobs with specific skills, with the private sector recording wage growth across a broad range of industries as businesses looked to retain experienced staff and attract new staff.
“Private sector wages rose 2.4 per cent annually, maintaining the rate of growth recorded in September quarter 2021.”
Meanwhile, public sector wages recorded an annual rate of wage growth to 2.1 per cent following a second consecutive quarterly increase after a low of 1.3 per cent during the June quarter of 2021.
Looking at states and territories, Queensland recorded the highest rate of quarterly wage growth at 0.8 per cent, with Victoria, South Australia, Western Australia, and the Northern Territory each recording the slowest rates of growth at 0.5 per cent.
On an annual level, Tasmania recorded the highest rate of growth, at three per cent, while WA came in last at just two per cent annual wage growth for the full year.
The ABS is set to release its Average Weekly Earnings report on Thursday, which it said would be influenced by changes in employment levels and hours worked within the labour market. These factors do not influence the WPI, which measures hourly earnings.
At an industry level, the accommodation and food services sector saw the largest annual increase in hourly rates of pay at 3.5 per cent. Retail average hourly earnings increased by 2.6 per cent, with rental, hiring and real estate services and professional, scientific and technical services growing hourly pay by 2.5 per cent.
Electricity, gas, water and waste services posted the smallest annual increase at 1.3 per cent, with the mining sector only slightly better at 1.8 per cent.