Australia's Wage Increase: 4.75% Rise Amid Inflation Challenges
Almost 3 million workers will get a 4.75% pay rise in July. But wages can’t catch up with inflation
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Starting July 1, nearly 2.8 million low-paid workers in Australia will receive a 4.75% wage increase, with the minimum wage rising from $24.95 to $26.44 per hour. However, this increase is insufficient to match inflation, which has resulted in a real wage cut of 5.9% for average earners over the past five years.
- 01Around 100,000 of the lowest-paid workers will see a 5.97% increase, raising their minimum wage to $26.44 per hour.
- 02The Fair Work Commission's decision reflects ongoing inflation, which has outpaced wage growth since June 2021.
- 03Women make up over 60% of the lowest-paid workers affected by this wage increase.
- 04Future wage rises are planned for specific professions to address the gender pay gap.
- 05The wage increase is seen as conservative, with concerns that it may not significantly improve workers' purchasing power.
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In Australia, nearly 2.8 million low-paid workers will benefit from a 4.75% wage increase starting July 1, 2026, as determined by the Fair Work Commission. This decision includes a 5.97% raise for around 100,000 of the lowest-paid workers, raising the national minimum wage from $24.95 to $26.44 per hour. Despite this increase, the commission acknowledged that workers' real wages have declined by 5.9% over the past five years due to rising inflation. The panel's decision was influenced by ongoing economic uncertainties, including the impact of the Middle East conflict on fuel prices. More than 60% of those affected are women, primarily working part-time in sectors like accommodation, health care, and retail. Future wage increases are planned for female-dominated professions to help close the gender pay gap. However, the panel expressed regret over not providing a more substantial increase, as inflation continues to outpace wage growth, leaving many workers struggling to maintain their purchasing power.
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The wage increase will provide some relief to low-paid workers, particularly women and part-time employees, but may not significantly improve their purchasing power amidst rising inflation.
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