Australia's wage inflation continues to moderate: Westpac IQ

14 Aug '24

2 min read

Australia's wage inflation continues to moderate: Westpac IQ

Pic: Westpac IQ

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Australia's wage price index rose by 0.8 per cent in Q2 2024.
On an annual basis, wages held flat at 4.1 per cent per year, but are still down from the peak of 4.2 per cent per year in December, Westpac IQ has said.
Wage inflation moderated in H1 2024.
Private sector wages rose by 0.7 per cent in June, representing an ongoing moderation in quarterly gains.

Australia’s wage price index (WPI) rose by 0.8 per cent in the second quarter (Q2) this year. On an annual basis, wages held flat at 4.1 per cent per year due to changes in seasonality, but are still down from the peak of 4.2 per cent per year in December, Westpac IQ recently said.

Wage inflation moderated in the first half (H1) this year, with the six-month annualised pace dipping from 4.7 per cent per year in December 2023 to 3.4 per cent per year in June this year, it said in a release.

“We were surprised to see the annual [WPI] pace hold flat at 4.1 per cent per year. Our forecasts suggested that the annual pace should dip to 3.9 per cent per year,” the company said.

Public sector wages did gain 0.9 per cent in June, up from the 0.6 per cent lift in March this year, which was the softest quarterly gain since September 2022.

Overall, the annual pace of public sector wages growth has moderated from 4.2 per cent per year in December 2023 to 3.8 per cent per year in March 2024, with a slight tick up to 3.9 per cent per year in June.

Private sector wages rose by 0.7 per cent in June 2024, representing an ongoing moderation in quarterly gains from September 2023 (1.4 per cent), December 2023 (1 per cent) and March 2024 (0.9 per cent). It is notable that private sector wages growth has also moved off its peak and that trend moderation continues.

Fibre2Fashion News Desk (DS)

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