Earn
Wage rises will flatten, central bank warns
The Reserve Bank of Australia has abandoned its expectation for any pick-up in wage growth over the foreseeable future and said inflation will not reach the bottom of its target of 2 to 3 per cent until 2022 at the earliest.
Wage rises will flatten, central bank warns
The Reserve Bank of Australia has abandoned its expectation for any pick-up in wage growth over the foreseeable future and said inflation will not reach the bottom of its target of 2 to 3 per cent until 2022 at the earliest.

In its downgrade of the full-year economic growth forecast for 2019, the Reserve Bank has trimmed its growth forecast for the 12 months to December by 0.25 of a percentage point to 2.25 per cent and also downgraded its June 2020 forecast to 2.5 per cent from the 2.75 per cent earlier flagged.
While the downgrades were minor, they showed the Australian economy might not have found the green shoots previously predicted.
“Wages growth is expected to remain around the current rate over the next couple of years,” the RBA’s statement read.
The Reserve Bank’s assessment of the economy matches expectations of unions and employee groups who are forecasting lean times for employees.

“The majority of companies in the liaison program as well as surveyed unions continue to anticipate little change in wages growth over the next year,” the RBA reported.
The statement highlighted weaker growth in the private sector in particular, with a gradual trend towards full employment.
“Private sector wage price index (WPI) growth is expected to increase very modestly, consistent with the gradual decline in labour market spare capacity. This is a little lower than previously forecast,” the RBA continued.
It conceded that the public sector will also struggle for real wage growth due to wage caps, with growth expected to “remain broadly stable over the next few years” with no indication of any changes to wage caps in place in most jurisdictions for many years.
There will be a boost to wages growth in the September 2020 quarter, the RBA did indicate, that will be spurred on by the 3 per cent increase in the award and minimum wage.
About the author

About the author


Salary
The financial benefits of a diversified income stream
In today’s volatile economic environment, relying solely on a single source of income can be risky. Diversifying your income streams can provide financial stability, reduce the risk of financial ...Read more

Salary
Despite losing top spot, Elon Musk rakes in $400,000 hourly
Elon Musk, the entrepreneur known for his involvement in a wide range of innovative and technological businesses, has recently been dethroned as the wealthiest individual in the world, with Bernard ...Read more

Salary
Rising unemployment and skill shortages prompt Australian businesses to look globally for talent
Australia has witnessed its unemployment rate surging above 4% for the first time in two years, revealed by the latest Labour Force data. Read more

Salary
New findings link job mobility hurdles to stagnant wage growth
Recent research from the e61 Institute has unearthed significant links between slow wage growth in Australia and obstacles to job mobility, including non-compete clauses, complicated occupational ...Read more

Salary
Employers scrambling to prevent workplace brain drain
As workplace managers face a swiftly evolving employment market that’s increasingly favouring the demands of white-collar employees and jobseekers, bosses are falling under mounting pressure to ...Read more

Salary
Unions back Albanese’s pledge to close gender pay gap
An electoral promise from Labor to make gender pay equity an objective of the Fair Work Act has been hailed as a “watershed moment” from industry peak bodies who have traditionally advocated for ...Read more

Salary
Coles asked to disprove $115m in alleged wage theft
One of Australia’s biggest supermarkets faces allegations that it underpaid more than 7,500 employees a total of $115 million. Read more

Salary
Gen Z left behind in progress to gender equality
Women under 25 may emerge from the pandemic in a worse financial position than when it began, new research has shown. Read more

Salary
The financial benefits of a diversified income stream
In today’s volatile economic environment, relying solely on a single source of income can be risky. Diversifying your income streams can provide financial stability, reduce the risk of financial ...Read more

Salary
Despite losing top spot, Elon Musk rakes in $400,000 hourly
Elon Musk, the entrepreneur known for his involvement in a wide range of innovative and technological businesses, has recently been dethroned as the wealthiest individual in the world, with Bernard ...Read more

Salary
Rising unemployment and skill shortages prompt Australian businesses to look globally for talent
Australia has witnessed its unemployment rate surging above 4% for the first time in two years, revealed by the latest Labour Force data. Read more

Salary
New findings link job mobility hurdles to stagnant wage growth
Recent research from the e61 Institute has unearthed significant links between slow wage growth in Australia and obstacles to job mobility, including non-compete clauses, complicated occupational ...Read more

Salary
Employers scrambling to prevent workplace brain drain
As workplace managers face a swiftly evolving employment market that’s increasingly favouring the demands of white-collar employees and jobseekers, bosses are falling under mounting pressure to ...Read more

Salary
Unions back Albanese’s pledge to close gender pay gap
An electoral promise from Labor to make gender pay equity an objective of the Fair Work Act has been hailed as a “watershed moment” from industry peak bodies who have traditionally advocated for ...Read more

Salary
Coles asked to disprove $115m in alleged wage theft
One of Australia’s biggest supermarkets faces allegations that it underpaid more than 7,500 employees a total of $115 million. Read more

Salary
Gen Z left behind in progress to gender equality
Women under 25 may emerge from the pandemic in a worse financial position than when it began, new research has shown. Read more