Private sector EBA pay rises hit 12-year high

The number of workers covered by enterprise agreements has also risen to 2.21 million, the highest since 2020.

The wages growth and increased spread of enterprise agreements will be welcomed by the Albanese government.

Average private sector pay rises in new enterprise agreements have hit 4 per cent for the first time in 12 years, while the number of workers covered by agreements has risen to 2.21 million, the highest since 2020.

The wages growth and increased spread of enterprise agreements will be welcomed by the Albanese government, which will argue the data released on Friday shows Labor’s industrial relations laws are driving pay rises and encouraging agreements between employers and employees.

According to the Department of Employment and Workplace Relations data, average wages growth in enterprise agreements approved in the June quarter was 4 per cent.

The growth was driven by high annual pay rises in three industries – construction (4.6 per cent), transport, postal and warehousing (4.5 per cent), and arts and recreation services (4.3 per cent). The data does not include the impact of the recent 21 per cent pattern pay deal in Victoria that was endorsed by the CFMEU’s construction division before it was placed into administration by the government. Blue-collar unions have launched a “line in the sand” campaign that aims to sign up 1000 employers to the new CFMEU agreement but employers are displaying a level of resistance.

While wages growth in the public sector was higher than 4 per cent in two quarters last year, it is the first time that private sector wage rises in new agreements have been at 4 per cent since 2012.

The number of workers covered by agreements has increased from 1.79 million in June last year to 2.21 million, the highest number covered since the March quarter in 2020.

There were 1203 agreements covering 275,400 employees ­approved in the June quarter compared to 938 agreements covering 136,200 employees a year earlier. But the calculated ­average 4 per cent increase is based on 984 of those agreements covering 143,000 employees that had quantifiable increases.

A further 219 agreements covering 132,400 employees had wage increases that could not be quantified, including a new Coles agreement covering 92,574 workers in which annual pay rises are linked to the Fair Work Commission’s annual wage review.

Agreements that formally covered unions had an average increase of 4 per cent compared to three per cent for non-union agreements.

According to the data, average pay rises in union agreements in recent years have been consistently higher than increases in non-union agreements.

For the 8123 enterprise agreements covering 1.53 million employees that were current as at June 30 this year, the average quantifiable wage increase was 3.4 per cent, up from 3.3 per cent in the previous quarter and 2.8 per cent a year earlier.