Aussies earning six-figure salaries feeling the pinch

The cost of living crisis has gotten so out of control in Australia that even those earning $100,000 are asking for pay in advance as they live “pay cheque to pay cheque”.

Australian workers on six-figure salaries are now asking for pay in advance as they look to find ways to pay bills as they live “pay cheque to pay cheque”.

The cost of living crisis has gotten so out of control in Australia that even those with steady employment earning $6000 a month on average still request pay in advance.

According to Australian wage-advance platform Wagepay, workers in hospitality, construction and healthcare are increasingly requesting early access to pay from small business owners.

This is surprising given they are also among the three sectors in high demand and experiencing pay increases.

Grocery bills have skyrocketed in Australia’s cost of living crisis. Picture: iStock

Even those earning more than $100,000 a year are requesting early pay, proving even high wage earners can get caught by unexpected expenses.

NSW workers have requested pay advances the most, followed by Queensland, then Victoria and Western Australia.

“In Australia, close to 50 per cent of the population lives pay cheque to pay cheque and the recent cost of living increases has made it very hard to budget for unforeseen costs,” Wagepay founder Tony Chan said.

“That’s particularly true for workers on varied or seasonal rosters, monthly pay cycles, which is probably why workers in hospitality, construction and healthcare make up the largest portion of our client base for Wagepay for business.”

The Australian Bureau of Statistics (ABS) shows some of the biggest increases Australians have seen with inflation since 2022 include international holidays, oils and fats, insurance, eggs, cheese, gas and electricity.

Hospitality business owner Julie Heng is just one of a growing number of small business owners whose employees are asking for pay in advance due to cost of living pressures.

Cha Cha Australia owner Julie Heng. Picture: Supplied

Ms Heng, alongside her father and brother, founded Cha Cha Australia in 2018. The family owned and operated bubble tea business has two locations in Melbourne and employs eight to 10 staff.

Earlier this year, Ms Heng began receiving requests for pay advances.

“I wasn’t surprised that my employees were asking for pay in advance,” Ms Heng said. “The cost of living is increasing for everyone, so it is getting harder for people to meet the rising cost of housing, groceries and bills, which means they sometimes find themselves looking for a little extra cash.”

Ms Heng, who set up Wagepay for Business off the back of recommendations from friends, said her employees were very happy to have the opportunity to receive their pay early.

“Our staff work really well for us and we wanted to do something to help them,” Ms Heng said.

“As a business owner during these tough times, we want to help our employees, but also need to be mindful of cash flow as our own costs increase.”

Wagepay for Business is free for employers, with anonymous verification of employment allowing staff to access fees at three per cent or lower.

Unlike other platforms on the market, business owners are not notified when staff use Wagepay for Business to protect the privacy of the employees.

“It’s allowed us to help our employees access their pay early, without impacting our business financially,” Ms Heng said. “It’s great our employees know they can access a third-party system to help them meet their financial obligations, when they need it.”

Wagepay launched during the pandemic in 2020, and now has close to 350,000 users and more than 900 small businesses on board.

The number of Australians using on-demand pay platforms such as InstaPay and Paytime has skyrocketed in the past year.

These platforms allow workers to receive their pay as soon as they earn it rather than wait until their usual payday, providing a lifeline to those battling against unexpected bills and other financial emergencies.

While Ms Heng is glad she and her family are able to retain their staff, she knows how hard things are for small businesses in Australia.

“My advice to other business owners who are going through tough times is to keep going, try and work efficiently and do the best you can,” Ms Heng said. “That’s all you can do.”

The National Debt Helpline is 1800 007 007.

Originally published as Aussies earning six-figure salaries feeling the pinch