Businesses are delivering the strongest rate of wages growth in more than decade, as the national private sector wages bill rose by 3.6 per cent in 2022, compared to 2.5 per cent in the public sector, according to data released today by the Australian Bureau of Statistics (ABS).
The seasonally adjusted Wage Price Index (WPI) rose 0.8 per cent in December quarter 2022, and 3.3 per cent annually, the ABS data showed.
“Nationally, annual private sector labour cost growth has increased to levels not seen for well over a decade,” Canberra Business Chamber chief executive Graham Catt said. “And business is clearly leading the way, with private sector wages up 3.6 per cent in 2022 compared to just 2.5 per cent in the public sector.”
While annual growth in the ACT was 2.9 per cent, below the national average, wages growth over the December quarter was the highest in Australia at 0.9 per cent.
“The sectors experiencing the most challenging workforce shortages, such as accommodation and food services, have experienced the highest quarterly increase in wages growth,” Mr Catt said.
Quarterly wage growth across industries was highest in the Accommodation and Food Services industry (1.7 per cent) and lowest in the Administrative and Support Services industry (0.3 per cent). Nationally, wages growth was experienced across the board with all sectors recording a rise of more than 0.6 per cent in the December quarter.
“With strong wages growth here in the ACT for the December quarter, there is no indication that growth will ease anytime soon. Employers can expect further significant wage increases in the year ahead,” Mr Catt said.
“Our members are reporting real world pay increases of 10 to 20 per cent. The ACT is a small market, and businesses compete with others here in the territory, the public sector, and interstate counterparts through regular and ad hoc wage reviews, sign on and retention bonuses, promotions, and other incentives.
“Businesses and the ABS data are telling us that wages growth is now a reality. Here in the ACT, we need to do more to help attract workers and address barriers like our high costs of housing, while at a national level there’s more work to do to reduce inflationary pressures and supply chain constraints.”
