Queensland Economic Advocacy Solutions

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Queensland wages are growing not declining

There will over the coming weeks and months be considerable scrutiny on wage levels in Australia as the Fair Work Commission’s Annual Wage Review for 2018-19 kicks off. This process adjusts the National Minimum Wage and the rates of pay for Australia’s 122 modern awards.

At present everyone tends to focus on 'nominal wages' where as a better indicator is unquestionably ‘real wages’ which adjusts for inflation.  This represents a true indication of whether the purchasing capability of an individual is increasing or not.  This is a much better measure for a livelihood.

Queensland’s inflation levels (as measured by the Brisbane CPI) have been lower than those Nationally and hence real wages growth in the Sunshine State has actually been higher.

Key points that can be made for Queensland include:

  • Queensland real wages growth in the year to the December quarter 2018 was 0.8 per cent and compares to the long term trend of 0.6 per cent.
  • Queensland real wages growth is now at it highest point in the last four years and is at its second highest level since the mining investment boom.
  • Queensland real wages growth of 0.8 per cent is noticeably higher than the national rate of 0.5 per cent.

Queenslanders in considering the debate on wages growth need to firstly differentiate between nominal and real wages growth.  In real terms we are starting to do ok.  

Secondly Queenslanders need to differentiate our State with what is occurring nationally.  At a national level real wages growth continues to remain 0.2 per cent under the long term trend and it is this that is giving rise to union campaigns for higher wages.

The final point I would make is that there have been three occasions whereby real wages have gone backwards in Queensland …. in 2008, briefly in 2011 and then again in 2014.  However, Queensland and Australian wage levels at present are definitely, 100 per cent, NOT going back at present despite many claims to the contrary.


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