Wage growth has stagnated under Australia's EBAs, unlikely to pick-up soon: ANZ Research
The average annual wage increase (AAWI) under new enterprise bargaining agreements (EBAs) has idled at 2.7 percent for the three quarters to September 2019. The private sector recorded a slight decline to 2.7 percent in Q3, which was largely offset by a small rise in the public sector to 2.6 percent, ANZ Research.
The average annual wage rise for all current agreements slowed to a record low of 2.6 percent in Q3. The EBA data are consistent with the weakening in the wage price index to 2.2 percent y/y in Q3.
The AAWI in the private sector has gradually declined over the past three quarters to 2.7 percent in Q3. This was largely offset by a small rise in the public sector AAWI to 2.6 percent, although this is still well down on the 3.3 percent recorded a year ago.
The Q3 results were mixed across industries. The largest declines in the AAWI under new EBAs were in arts and recreation (-0.5ppt), accommodation and food services (-0.4ppt), and transport, postal and warehousing (-0.4ppt).
The largest improvement was in rental, hiring and real estate (+1.4ppt to 3.5 percent), but this AAWI is still less than half of what it was a year ago. Construction, other services, utilities and retail also recorded rises in the AAWI for new agreements.
Only three out of the 19 industries had an AAWI at or above 3 percent: construction; rental, hiring and real estate; and utilities.
"We do not expect a material pick-up in wage growth any time soon," the report further commented.