Workplace Express (August 13 2025) has reported that the growth in private sector rates of pay excluding bonuses has held steady on the back of its recent slow easing trend, according to ABS data. The Bureau's Wage Price Index shows that annual growth in private sector rates in the June quarter was 3.3%, the same as the March quarter in trend terms.

Wage Growth Steady

Workplace Express (August 13 2025) has reported that the growth in private sector rates of pay excluding bonuses has held steady on the back of its recent slow easing trend, according to ABS data.  The Bureau's Wage Price Index shows that annual growth in private sector rates in the June quarter was 3.3%, the same as the March quarter in trend terms.

It peaked at 4.2% annually for three successive quarters in late 2023, early 2024. However, in the public sector, rates grew by 3.6% in trend terms, up from 3.3% in March after a 1% lift for the quarter, while rates across the economy grew by 3.4%, up from 3.3%.

Meanwhile, the Reserve Bank on August 12 2025, in its six-monthly monetary policy statement revised its medium-term trend productivity forecast downward and said that as a result, the sustainable level of wage growth has been crimped.

After assuming an average growth of 1% a year at the end of its two-year forecast period, it is now expecting just 0.7%. It says the change recognises that some of the lower productivity growth in recent decades is attributable to persistent factors.

The slower growth in productivity "implies that the rate of wages growth that can be achieved over the longrun without generating inflationary pressure is lower.

The bank says in the statement that long-term WPI growth "consistent with" full employment and achieving the 2% to 3% inflation target "drops from 3% to around 2.9%", due to the "productivity downgrade", or from 3.5% to 3.2%", using the Average Earnings in the National Accounts measure.