Wages rise 3.4% in year to March, beating expectations
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The news: Wages increased 3.4% over the year to the March quarter, the first acceleration since the June 2024 quarter and better than market expectations, according to the Australian Bureau of Statistics' latest figures.
The numbers: Private sector wages increased 0.9% over the first quarter, higher than the 0.7% rise in the December quarter 2024.
Public sector wages increased by 1% over the first quarter, higher than the 0.6% in the December quarter 2024.
On an annual basis, private sector wages increased 3.3%, slower than the public sector wage growth of 3.6%. The rate of growth compared to the December quarter 2024 is unchanged for the private sector while the public sector is up from 2.9%.
The context: The numbers are better than expected, as the market was expecting a 3.2% year-on-year increase in the March quarter while the Reserve Bank expected the index to hit 3.4% by the second quarter.
Goldman Sachs expected wage growth to hit 0.8% over the quarter and 3.2% over the year, while Commonwealth Bank expected a 0.8% quarterly increase.
NAB’s monthly Business Survey, released yesterday, indicated that labour cost growth remained at 1.6% in April.
What they said: "Private sector wage growth was also influenced by administrative wage adjustments due to the Stage 3 Aged Care Work Value Case, and the Early Childhood Education and Care Worker Retention Payment. It was also impacted by regular March quarter wage and salary reviews," ABS head of prices statistics Michelle Marquardt said.
"Wages growth in the public sector was impacted by new state-based enterprise agreements, and to a lesser degree, increases paid to aged care workers."
The source: Australian Bureau of Statistics
