Sep 8, 2017

Will wages ever start going up again?

Australian pollies love to say wages growth is a J-curve, but is it necessarily true that what goes down must go up again? Benard Keane and Glenn Dyer think perhaps not.

Back in the 1980s, we were obsessed with the current account deficit. Every quarter, the deficit would be the subject of national self-flagellation. We've long stopped worrying about it -- various things like foreign debt and productivity have replaced as national sackcloth-and-ashes rationales, but for a while it was a big thing.

Paul Keating used to argue that the government's reforms and budget discipline would turn around the deepening deficit graph, which would thus turn into a "J". A cartoonist at one point had the current account deficit going off its wall chart, down the wall, and through a hole in the floor. Keating stood over the hole, with binoculars, peering down. "I swear it's a J!" he was saying.

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One thought on “Will wages ever start going up again?

  1. klewso

    Not if employer groups have their way. Pearson from the ACCI was on The Business tonight reciting why they can’t – “however much they’d love too”.
    I’d like to know how much productivity can be cranked up each time such reviews come up? …. Eventually one person will be doing 10 people’s work – for one person’s pay?

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