ABS Statistics Show Public Sector Wages Growing at a Faster Rate Than Private Sector
According to data from the Australian Bureau of Statistics (ABS), overall wages increased by 0.8 percent in the June quarter and 4.1 percent for the year.
The ABS statistics show that public sector wages saw a greater rise compared to the private sector during the June quarter of 2024. Australian wages as a whole grew by 0.8 percent during this period and have risen by 4.1 percent over the past year.
In contrast, private sector wages only rose by 0.7 percent in the June quarter of 2024, which was lower than the 0.9 percent increase seen in the previous quarter. ABS head of price statistics Michelle Marquardt pointed out that this was the smallest rise in private sector wages in three years.
On the other hand, public sector wages saw a significant increase of 0.9 percent in the June quarter, up from 0.6 percent in the March quarter of 2024.
The ABS highlighted that all Australian Public Service employees received a pay rise effective from March 14, 2024. Previously, pay raises in these sectors were implemented across different quarters based on individual agency agreements.
Marquardt noted that the heightened rise in public sector wages was primarily due to the synchronized timing of Commonwealth public sector agreement increases. This increase marked the highest for any June quarter since 2012, although it was lower than the December quarter of 2023.
Wage Rise Weaker than Expected
In response to the data, ANZ researchers expressed that the overall wage price index saw a slightly weaker growth than expected by the market and the RBA.
Birch anticipated that the slowing of wage growth would not alter the RBA’s perception that wage growth is still above a level sustainable considering trend productivity growth.
The ANZ expected the RBA to maintain the cash rate at 4.35 percent until February 2025.
Meanwhile, Treasurer Jim Chalmers and Employment Minister Murray Watt affirmed that annual real wages would continue to rise.
“Under a Labor government, this return to sustainable wage growth is welcomed, but pressure on individuals persists,” the ministers expressed in a joint statement.
They stated that since taking office, wages had been growing at a rate of 3.8 percent per year, with a focus on addressing inflation and delivering responsible cost-of-living relief through tax cuts.
