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This week’s Q1 national accounts, released by the ABS, comprehensively debunked the view put forward by the business lobby that below-CPI wage rises are necessary to keep a lid on inflation.
As shown in the next chart, nominal compensation per employee rose by a sluggish 2.2% in the year to March, well below the 20-year average of 3.4%:
This sluggish growth in employee compensation has come despite labour productivity booming over the pandemic:
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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.