Recent statements by the Reserve Bank of Australia (RBA) suggested that wage pressures were building based on spurious business liaison ‘evidence’.
Business groups have also scare mongered that “unsustainable” wage claims were adding to the nation’s inflationary pressures.
However, the actual data on wages showed zero evidence of a wage-inflationary spiral. Australia’s real unit labour cost (ULC), which according to the Australian Bureau of Statistics “are an indicator of the average cost of labour per unit of output produced in the economy” and “are a measure of the costs associated with the employment of labour, adjusted for labour productivity”, collapsed 6.3% below its pre-pandemic level in the March quarter of 2022:
