Australians typically see their pay levels peak when they reach age 40, new tax data shows.
Alarmingly, people in their 30s don’t earn enough to move up the real estate ladder if they want to buy a home on their own and receive the money before retirement age.
And those in their 20s earn a similar amount to baby boomers who are still working into their 70s.
The Treasury’s Fiscal Outlook and Expenditure Statement has revealed the average earnings of Australian workers by age group.
People aged 45-49 had the highest average salary of $96,200 during the 2021-22 financial year.
At the time, this was 4.5 per cent higher than Australia’s average full-time salary of $92,030.
Converted to 2024 earnings, people in their 40s would typically earn $104,549 based on a 4.5 percent premium on an existing average full-time salary of $100,017.
Emeritus Professor Mark Wooden, a labor economics expert at the University of Melbourne, said professionals in their 40s had often been in an industry for two decades and were more productive.
Australians typically see their salary levels peak when they reach their forties (photo is a stock image)
“They’ve been there for 20 years, a lot of time has been invested in them learning the trade,” Professor Wooden told Daily Mail Australia.
“So the last thing you want is for them to leave and hire a new, younger person who then has to learn it all over again.”
But Professor Wooden suggested that salaries would probably peak at the age of 50, for professionals working in white-collar industries.
“The peak will probably vary wildly depending on occupancy,” he said.
“If you have a white-collar job, I would expect the peak to be later than age 40; your careers are likely to be longer, you’re not doing manual labor, so your body failing you isn’t a problem.” . affair.
“If the type of skills are cognitive, which are developed with experience, you would expect salaries to continue to grow.”
Someone earning a top salary of $96,200 could now buy a $625,300 home with a 20 per cent mortgage deposit.
That kind of debt limit would allow you to buy an apartment, but not a mid-priced home in Australia’s major capital markets.
People aged 45-49 had the highest average salary of $96,200 during the 2021-22 financial year (pictured, Sydney’s Pitt Street Shopping Centre)
Emeritus Professor Mark Wooden, a labor economics expert at the University of Melbourne, said professionals in their 40s had often been in an industry for two decades and were more productive.
Workers in their early 50s had the second-highest average salary of $95,500, followed by those ages 40 to 44 at $90,600.
Those between 55 and 59 years old earned $88,400, ahead of between 35 and 39 years old with $80,500.
Older workers close to retirement, ages 60 to 64, earned $75,200.
They defeated Age group 30 to 34 years old with $69,400.
With a 20 mortgage deposit, that would only buy a $451,100 home, which would be enough for a small unit in the city of Melbourne, but not a house.
That’s bad news for those who hope to buy a home with a 30-year mortgage and pay it off when they retire at age sixty.
Australia’s youngest adult workers produced the largest number of income earners, with 1.815 million people aged 18 to 24, the age at which someone is most likely to work part-time and obtain a university degree.
Their average salary of $36,500 was less than half the $75,200 average of those in their 60s who were eligible for retirement.
Professor Wooden said older, high-paid workers had typically been with a company for a long time, but added that these people would often struggle to find another job at the same salary if they were made redundant.
“Many of the people over 60 who work have been in the same job for a long time,” he said.
“Those people have fairly high salaries; they’re unlikely to reduce them unless the company actively wants them to leave, but if a company goes through a crisis, if an older worker loses their job, then it’s very unlikely, on average, let them go.” get another job earning something similar to what they earned.
Workers in their twenties earned a similar amount to baby boomers who were still working in their seventies.
Their average salary of $58,400 was similar to that of those ages 70 to 74 who earned $55,100 and the 75+ age group of $56,600.
The Treasury document also divided taxable personal income into deciles, or ten equal parts.
High-income earners earning more than $136,700 were in the highest decile.
People with above-median incomes, between $100,401 and $136,700, were in the second-highest category, while those with incomes between $79,801 and $100,400 were in the third-highest decile.
Only 13.1 per cent of workers belonged to a union in August 2024, according to separate data from the Australian Bureau of Statistics.
Just over a third or 36 percent of professionals were working from home.
Australia’s median or average salary stood at $72,592 in August, which includes full- and part-time workers.
For full-time workers, the median salary was $88,400 compared to $35,937 for part-time workers.