Wage growth continues to slow down in Australia

Consumer confidence and business conditions continue to be adversely impacted by the COVID-19 pandemic.
By: | August 12, 2020

With Australia’s unemployment rate hitting a 22-year high of 7.4% this June, the Australian Bureau of Statistics (ABS) has reported the slowest growth in the country since records began in 1997.

According to the ABS, Australia’s official wage price index (WPI) rose 0.2% in the three months to the end of June, continuing from the downward trend of 0.5% growth recorded in the first quarter.

Annual wage growth slowed to 1.8%, also the lowest on record. Private sector wages fell for the first time on record, easing 0.1% in the second quarter from the first three months of the year.

Andrew Tomadini, head of price statistics at the ABS, explained, “The fall in private sector wages is mainly due to a number of large wage reductions across senior executive and higher paid jobs.”

READ: Australia extends wage subsidy support till 2021

In a bid to keep Australians employed, the government last month, announced a six-month extension of a A$70 billion (US$50 billion) programme that will provide wage subsidies for businesses affected by the COVID-19 pandemic.

Across the country, infections continue to surge as cities such as Victoria continues to be placed under tight restrictions that have closed down many businesses.

Workers in Victoria are also the first in the country to receive a pandemic leave payment. Those who have run out of sick leave but need to serve a 14-day quarantine period will each receive A$1,500 (US$1,067) for a two-week pandemic leave period. If required, workers will be able to apply for the payout multiple times.