Wage growth fell below 4 per cent for the first time since June 2023

The pace of Aussies getting a pay rise has slowed below market expectations, official figures show.

Wage growth rose by 0.8 per cent for the quarter. Picture: NewsWire / John Appleyard

Aussie wage growth is slowing faster than the market expected, but pay rises are still outstripping growth in inflation.

According to the national figures released by the Australian Bureau of Statistics on Wednesday, the wage price index (WPI) rose 0.8 per cent in September quarter 2024, and 3.5 per cent for the year, according to seasonally adjusted data.

ABS head of prices statistics Michelle Marquardt said September annual wage growth was 3.5 per cent, falling below 4.0 per cent for the first time since June quarter 2023.

This comes as Australia’s official inflation rate is at 2.8 per cent, although underlying inflation came in at 3.4 per cent during the same period.

While wages continued to grow over the 12 months to September, it was slower than the market was expecting.

Wage growth orse by 0.8 per cent for the quarter. Picture: NewsWire / John Appleyard

Seasonally adjusted, annual public sector wage growth was higher than private sector growth for the first time since December quarter 2020.

Public sector annual growth 3.7 per cent was higher than in the same quarter last year 3.5 per cent, but lower than the recent peak 4.2 per cent seen in December quarter 2023.

“Annual growth in the private sector was 3.5 per cent in the September quarter 2024. This is the lowest private sector annual growth since the September quarter 2022,” Ms Marquardt said.

The average size of hourly wage change was lower in September quarter 2024 3.7 per cent compared to the same period in 2023 5.4 per cent.

“Wage rises for many jobs can be directly or indirectly linked to the outcomes of the Fair Work Commission Annual Wage Review decision,” Ms Marquardt said.

“The latest decision of a 3.75 per cent wage increase paid from 1 July 2024 was lower than the September quarter 2023 increase of 5.75 per cent. It was also lower than the commission’s September quarter 2022 awarded increase of between 4.6 per cent and 5.2 per cent,”

As wage growth remained above inflation rate, the number of jobs being advertised on employment platform Seek has also fallen to 3.1 per cent.

South Australia 1.4 per cent and Western Australia per cent were the only states to record job ad growth in October.

Aussie wages continue to fall putting pressure on consumer spendings. Picture: NCA NewsWire / Damian Shaw

The ACT recorded the largest decline in job ads, fell 7.8 per cent followed by Tasmania 4.0 per cent and Victoria 3.9 per cent.

“Demand for retail consumer products workers led the overall fall in job ads in October. The decline in worker demand comes as household spending is growing slowly, indicating subdued consumer activity at this late stage of the year,” Seek senior economist Blair Chapman said.

Applications per job ad, which have been growing consistently for over two years, fell slightly in September, dropping 0.9 per cent.

“After 26 months of steady growth, applications per job ad declined in September, but remain extremely elevated. So while the market remains relatively tight, competition among candidates is also very strong,” he said.

Originally published as Wage growth fell below 4 per cent for the first time since June 2023