Back in February, one or two excitable commentators suggested Australia had “turned the corner” on wages growth in the December quarter. If that was the case, we certainly went back around it again in March, with another shocker of a result delivered today.

According to the Australian Bureau of Statistics, wages grew overall by 0.5% for a 2.1% annual growth rate — the same as in the December quarter. But in the march quarter, public sector wages growth — the reason for the tiny uptick at the end of last year that got optimists excited — declined slightly to 0.5%/2.3%. The rest of us in the private sector are stuck in neutral, with unchanged growth of 0.5% and 1.9% for the year.

Once again, the government-controlled health care and education sectors were the biggest sources of wages growth — only transport and utilities showed any sign of life in the private sector. The big private employers, construction and retail, had below-average growth, while professional services was also poor. Victoria was again the mainland state with the strongest wages growth, at 2.3%; Tasmania also managed 2.3%.

The figures mean that on average, employees are just keeping ahead of inflation (1.9% for the CPI and 2% for the Reserve Bank’s preferred core measures). But if you’re in construction and retail, or even mining (where the likes of BHP, Rio Tinto and other miners are now back to making outsized profits), you’re going backwards in real terms.

The government is now — stop us if you’ve heard this one before — struggling to meet its 2.25% wage growth target for 2017-18 that it revised down in December from 2.5%. It will needs wages growth to surge to 0.65% in the current quarter to hit it — a prospect that doesn’t fill us with optimism.

Given this weak result, its no wonder the Reserve Bank warned on Tuesday, via Deputy Governor Guy Debelle, that unemployment might have to fall under 5% or thereabout to get wages growing faster. According to Debelle, the bank was finding that and more wage settlements had been “bunching around 2% over the past five years or so.” “There is a risk,” he said, “that it may take a lower unemployment rate than we currently expect to generate a sustained move higher than the 2% focal point evident in many wage outcomes today.”

Meanwhile, with strong profits, record low interest rates and a government hellbent on giving them big tax cuts, corporations are doing very nicely, thank you.

Peter Fray

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