What you now have to earn in Australia to be above average

An Australian making less than $94,000 a year is now considered below average and really needs a big pay rise to cope with the cost of living crisis.

Wage levels are now rising at the fastest pace in a decade, but Australian workers are suffering a record cut in real wages as inflation far outpaces wages.

The average full-time weekly wage in November was $1,807.70 or $94,000 per year before overtime and bonuses, the Australian Bureau of Statistics revealed on Thursday.

If pay levels had risen in line with inflation, the typical Australian worker would have earned $98,000, compared with $90,916 at the end of 2021.

Even then, that $4,000 difference from the real median salary of $94,000 would only cover the rising cost of everyday items like grocery and gas bills, but not sky-high mortgage payments.

Public sector workers generally earned $102,180 compared to $91,936 for those in the private sector.

An Australian is much more likely to earn a six-figure salary if they work as a civil servant, miner or finance professional, but not as a builder.

Australian wages rose 3.3 percent last year, the fastest pace in a decade, but this was well below the 7.8 percent inflation rate, the worst since 1990.

That means workers are effectively taking a record cut in real, inflation-adjusted wages.

Treasurer Jim Chalmers has disputed Reserve Bank Governor Philip Lowe’s claim that Australia would face a price and wage spiral like that of the late 1970s and early 1980s, with a rate unemployment rate of 3.7% in January only slightly above December’s 48-year low of 3.5%.

“Wage growth is not the problem when it comes to inflation, it is part of the solution to cost-of-living pressures,” he said.

“We don’t have an inflation challenge in our economy because wages are too high, but because of a war in Ukraine, pressure on global supply chains and other challenges in our own economy that have been ignored for too long.”

Commonwealth Bank Australian economics chief Gareth Aird said labor market tightness peaked in September 2022, adding that wage growth is likely to only slow in 2023 with more applicants for each job ad. job.

“Since then, the flow of immigrants and foreign workers into the country has accelerated,” he said.

‘At the same time, job advertisements have decreased and the number of applicants per job advertisement has increased. This slows down wage growth.’

Aird said bosses had offered short-term bonuses to attract and retain staff who could easily be withdrawn as interest rate hikes slowed the economy.

“Companies that have used bonuses and other one-time payments to reward, retain and attract workers instead of adjusting base pay upwards have not had a permanent upward adjustment in input costs,” he said.

“As demand in the economy slows, these payments may be reduced.”

The mining industry had the highest median salary at $146,208, followed by information technology, media, and telecommunications ($118,076); finance and insurance ($114,478); professional, scientific and technical services ($111,301); and electricity, gas, water and sewage services ($109,106).

The public administration and security category, which groups public servants and police officers, had an average salary of $101,244.

Despite a shortage of builders and homes, the construction sector had a below-average wage of $92,872 and increases in interest rates were expected to reduce demand for new homes.

Full-time retail workers now earn $70,398 a year, following a 5.2 percent increase in the minimum wage on July 1 that was slightly above inflation at the time.

Hospitality workers earn $67,278 a year, in a sector known as food and lodging, and their minimum wage increases are delayed until October 1.