Labour shortages fail to lift wages

By

August 19 2021
Share

Despite the business community’s hunger for new workers, Australia’s wage growth remains stagnant, official figures have revealed.

Figures released by the Australian Bureau of Statistics (ABS) showed that the seasonally adjusted wage price index (WPI) rose by 0.4 per cent in the June quarter.

Australia’s growth rate for the 2020-21 financial year now sits at 1.7 per cent.

ABS head of price statistics Michelle Marquardt said the rate of growth over the quarter was one of the lowest recorded in the series.

“The June quarter saw the rate of growth in hourly earnings ease to 0.4 per cent, following two quarters of 0.6 per cent wage growth,” she said.

Compared with June quarter 2020, private sector hourly wage rates rose 1.9 per cent in the comparable period.

The impacts of low wages were also felt on the public sector, which recorded growth of only 1.3 per cent for the year, which is the lowest annual growth rate since the ABS began tracking the data in 1997.

Workers are going backwards

The Australian Council of Trade Unions (ACTU) was quick to point out that Australians have actually gone backwards, urging the government to do more to support Aussie workers.

ACTU highlighted that in real terms, wages actually dropped 2.1 per cent over the last 12 months.

They also noted that while the WPI added 0.4 per cent in the June quarter, inflation increased to 3.8 per cent, meaning the cost of goods increased while wages did not.

ACTU president Michele O’Neil said Australians don’t deserve to be priced out of basic essentials like housing and food.

“We’re seeing low job security, an increasingly casualised workforce, and falling real wages. These figures show that at the very time when workers need security and confidence, they have a government with no plan to provide either,” Ms O’Neil said.

Skill shortages remain

While wages continue to stagnate, Australia still faces skill shortages.

Preliminary results for the National Skills Commission’s Internet Vacancy Index (IVI), released in July, show online job advertisements fell a further 3 per cent (7,200 jobs) in July 2021 to stand at 232,600.

The IVI has now recorded two consecutive months of declining recruitment activity after job advertisements reached a 12-year high in May 2021.

Despite this, wages are not moving, Ms Marquardt pointed out.

“Apart from a few isolated examples of skills shortages placing pressure on employers to meet expected market rates, the private sector wage growth recorded over the quarter (0.5 per cent) was generally subdued,” she concluded.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

sections

most read

sections

most read

sections

most read

sections

most read

sections

most read

sections

most read

sections

most read

Most read

Age Pension increase prompts Australians to review their finances

Latest Podcast

Australia’s inflation surges amid Iran conflict, prompting potential RBA rate ...

Resources

There is $17.5 billion in lost and unclaimed super across ...

Earn