Millions of Australian workers will get a 3.5 per cent pay rise from July 1, following the Fair Work Commission's (FWC) annual review of the minimum wage and award agreements. The commission's decision increases the national minimum wage to $24.95 per hour or $948 per week, based on a full-time, 38-hour working week.Inflation is currently at 2.4 per cent annually. While the national minimum wage covers a small proportion of the workforce, about a fifth of all employees in Australia are paid at a minimum award rate.
The Fair Work Commission said; "The principal decision which has guided our decision is the fact that, since July 2021, the real value of modern award wages … has declined by 4.5 percentage points relative to inflation."
Australian Council of Trade Unions secretary, Sally McManus says it equates to 1.1 per cent more than inflation, while the employment minister, Amanda Rishworth says the decision will not just help workers on a minimum wage get by but will start to help them get ahead.
The union movement had lobbied for an increase of 4.5 per cent, and the government asked the commission for an "economically sustainable real wage" rise, but business groups were lobbying for much less.
Australian Chamber of Commerce and Industry chief executive, Andrew McKellar says many small businesses in retail, hospitality, restaurant and cafes will really struggle to afford an increase of this magnitude.
However, Professor John Buchanan from the University of Sydney says the Commission could have done better, saying "given we're dealing with the poorest 25 per cent that only account for 10 per cent of labour costs."
The Commission says its satisfied businesses can handle this higher wage bill. Its says profits are steady, and business conditions are likely to improve as lower interest rates boost spending power.
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