Australia's Wage Price Index data for the December quarter are to be published by the ABS today at 11:30am (AEDT). In response to the pandemic shock and resulting dislocation in the labour market, Australian wages growth has slowed to its lowest level on record. The pandemic and the measures brought in to contain it has led to a substantial increase in spare capacity in the labour market, while many firms have responded to the crisis by implementing wage freezes (some have introduced temporary cuts) and in the public sector freezes and caps on the pace of wage increases have been common.
As it stands | Wage Price Index
The headline WPI came in weaker than expected in the September quarter at 0.07%, slowing to a new record low at 1.36%Y/Y from 1.82%. The slowdown remains more severe in the private sector where the annual pace declined to 1.21% from 1.68% while public sector wages growth eased to 1.77% from 2.07%, though both were at their lowest on record. The slowdown in wages growth has been broad-based across the economy with 7 of the 18 industries measured by the ABS returning a sub 1% annual pace as of Q3. For a full review of Q3's data see here
Another soft outcome is expected to be reported today with the median estomate for wages growth in Q4 situated at 0.3%, with the range of forecasts between 0.1% and 0.4%. This would see the annual pace slowing further to 1.1%.
