Each quarter the Australian Bureau of Statistics (ABS) surveys around 3000 enterprises regarding a sample of jobs in each workplace to measure changes in the price of labour across around 18000 jobs.
According to the latest wage price index figures published by the ABS, hourly wages grew by 0.5% in the June quarter, down from the revised March figure of 0.6% but in line with market expectations. Year-on-year growth was steady at 1.9% (after revisions) which means it is still at the lowest growth rate since the beginning of the series in 1999.
ANZ economist Felicity Emmett said the figures were “broadly in line” with the RBA’s expectations “although the tick down in private wage growth would be disappointing.” However, she expects the figures to “pop higher” in the September quarter as a result of the “larger-than-usual” increase in the minimum wage rate handed down by the Fair Work Commission in June.
Public sector hourly wages growth continued to grow faster than private sector hourly pay. Public sector hourly pay grew by 0.6% for the quarter and 2.4% for the year to June while the comparable figures for the private sector were 0.4% and 1.8%.
The hourly wages growth report produced another figure at the bottom of readings since the series began in 1999 and hourly pay growth in the private sector has now slipped below the annual rate of headline consumer inflation. However, some economists have been speculating the downward trend of slower and slower rates of growth may have come to an end. UBS economist George Tharenou said, “it now seems likely the WPI has finally troughed, amid clearly stronger jobs and business conditions and more importantly the surprising 3.3% minimum wage increase…”