Home » wages and hours » The decline of minimum wages in Australia

The decline of minimum wages in Australia


Bill Mitchell crunches the numbers regularly and well. These graphs tell a grim story

The graph above shows the evolution of the real Federal Minimum Wage (red line), GDP per hour worked (blue line), and the Real Wage Price Index (green line), the latter is a measure of general wage movements in the economy. Th graph is from June 2005 up until June 2016 (indexed at 100 in June 2005).
By June 2015, the respective index numbers were 117.4 (GDP per hour worked), 107.1 (Real WPI), and 104.1 (real FMW). This tells us that all workers have failed to enjoy a fair share of the national productivity growth, and that minimum wage workers in Australia have been largely excluded from sharing in any of the productivity growth.
Successive minimum wage decisions have forced workers at the bottom of the wage distribution to fall further behind in relative terms.
In the December-quarter 1993, minimum wage workers earned around 55 per cent of the Full Time Adult Ordinary time earnings. By June 2016, this ratio will have fallen to around 44 per cent. There has been a serious erosion of parity over the last 18 years




Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: