The Australian Bureau of Statistics (ABS) has just released its Wage Price Index for the December quarter of 2013, which revealed a continued moderation of wage pressures across the economy, with annual wages growth also tracking at the lowest rate in the series’ 16-year history (see below charts).
According to the ABS, wages grew by 0.7% (s.a.) 0.6% (trend) in the December quarter, slightly above analyst’s expectations. Private sector wages grew by 0.6% (both s.a. and trend) over the quarter, whereas public sector wages grew by 0.9% (s.a.) and 0.7% (trend). Over the year, total wages grew by 2.6% (s.a.) and 2.5% (trend), with the private sector experiencing 2.5% growth (both s.a. and trend) and the public sector 2.7%/2.6% growth (s.a./trend).
You can see from the next chart, which plots non-seasonally adjusted wages growth on a 6-month moving average basis (in order to reduce volatility), that wages growth has softened everywhere, except South Australia:
In a similar vein, wages growth has weakened across most industries, including mining:
There’s not much joy here for workers, given that unemployment is also trending upwards. Indeed, given the strong correlation between wages growth and full-time jobs, wages will likely continue to come under pressure (chart from Matt Cowgill):
