What small business employees in Australia really earn and why the sector is outperforming others in pay increases
- Human resources group revealed salary increases
- Jobs hero warns of spiraling wages and prices
Small business employees have been receiving some of the most generous pay increases in Australia, new data shows.
The February unemployment rate fell back to a 48-year low of 3.5 percent, making it harder for bosses to hire and retain staff.
That has prompted small and medium-sized companies to offer wage increases, including bonuses, well above Australia’s 3.3 per cent wage increase last year.
Hourly pay rates in some industries are well above the national average of $37 or $76,960 a year for a full-time staff member working 40 hours a week.
Even the highest-paid industry was generous with human resources software company Employment Hero, which revealed that the science, information and communication technology category had offered annual wage increases of 5.8 percent in January.
That median hourly pay rate of $58.87 equated to an annual salary of $122,450.
The health and community services sector saw its hourly pay rates increase by 7.4 percent to $41.43, which equates to $86,174 per year.
Small business employees have been receiving some of the most generous pay increases in Australia, new data shows (a Sydney bartender pictured)
The construction and trade sector offered the most generous annual increase of 8.4 percent to $37.93 an hour or $78,894 a year.
Even the lowest paid sectors offered more generous increases.
Manufacturing, transportation and logistics offered increases of 5.1 percent, bringing hourly pay to $35.43, or $73,694 a year.
Retail, hospitality and tourism saw their hourly pay levels rise 6.6 percent to $31.42, or $65,354 a year, after the minimum wage increased 5.2 percent in July and October.
Employment Hero chief executive and co-founder Ben Thompson said higher wages would worsen inflation, with a consumer price index at 7.8 percent, the worst in 32 years.
The construction and trade sector offered the most generous annual increase of 8.4 per cent to $37.93 an hour or $78,894 a year (Pictured: Melbourne construction workers)
“As wages start to rise again, this is a big alert that we are not out of the woods and that Australia could be in the midst of an upward price and wage spiral,” he said.
“With an insufficient supply in the market, this is a concern for SMEs that cannot keep up with the conditions of the talent market.”
Their data included penalty rates, bonuses, and assignments like overtime.
The Reserve Bank of Australia expects to continue raising rates with inflation well above its two to three percent target.
ANZ expects two more rate hikes in February and March that would take the cash rate to an 11-year high of 4.1 percent, up from 3.6 percent now.
“Ultimately, we see that the question is not ‘where’ the RBA gets to (we’re still in favor of a 4.1 percent terminal rate), but ‘when’ it gets there,” its economists said.
Reserve Bank of Australia Governor Philip Lowe warned of a wage and price spiral, but Treasurer Jim Chalmers refuted that argument.
Employment Hero chief executive and co-founder Ben Thompson said higher wages would worsen inflation, with a consumer price index at 7.8 percent, the worst in 32 years.
