Private sector salaries increased by only 4.1% in June, showing slow growth.

Recent data from the Australian Bureau of Statistics (ABS) has revealed that wage growth in the private sector has hit a new low, with the smallest quarterly increase since 2021. In the June quarter, wages rose by 4.1 per cent compared to the same time last year. However, this is only a marginal increase of 0.8 per cent from the previous quarter, which saw a growth of 0.9 per cent.

The sluggish growth in the private sector is evident as wages only rose by 0.7 per cent, according to the ABS head of prices statistics, Michelle Marquardt. This is the smallest rise recorded for a June quarter since 2021. On the other hand, in the public sector, wages saw a more significant increase of 0.9 per cent, compared to 0.6 per cent in the previous quarter.

This growth in the public sector can be attributed to a pay raise that came into effect in March for all public servants. Marquardt explained that this stronger rise in the June quarter was due to the synchronised timing of Commonwealth public sector agreement increases. Previously, pay rises for these jobs were paid at different times across quarters, depending on the timing of individual agency agreements.

Overall, yearly wages in the public sector have risen by 3.9 per cent, which is slightly higher than the 3.8 per cent recorded in the previous quarter. In contrast, the private sector saw a yearly wage growth of 4.1 per cent in the June quarter, after three consecutive quarters of 4.2 per cent growth. This is also higher than the 3.9 per cent growth seen at the same time last year.

These new statistics indicate a concerning trend for wage growth in the private sector, with slower growth compared to previous years. The public sector, however, has seen a slightly more positive outlook with a stronger increase in wages. It will be interesting to see how these numbers will continue to evolve in the coming months and what impact they will have on the overall economy.

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