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The most recent Australian Bureau of Statistics (ABS) wage price index for the December quarter of 2025 revealed that real inflation-adjusted wages declined by 0.3% in 2025 and were tracking 6% below their Covid-19 ‘bubble’ peak at roughly late 2011 levels:
The Reserve Bank of Australia’s (RBA) forecasts, laid out in its May Statement of Monetary Policy (SoMP), suggest that real wages will decline in the near term, driven by energy inflation from the Middle East, and won’t recover in the forward estimates.
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Australian real wages are forecast to bottom out in the September quarter of 2026 at around March 2010 levels.
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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.