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No sign of an increase in employees' share of Australian economic growth

September 11, 2017 - 00:15 -- Admin

Financial Review, 6 September 2017:Wage growth is showing no sign of the increases the Reserve Bank of Australia is banking on, with average employee compensation going backwards and hourly pay growth at record lows.The economy's overall wages bill rose a modest 0.7 per cent in the June quarter and 2.1 per cent for the year, according to the latest national accounts figures, but fell per non-farm employee by 0.3 per cent on a quarterly and annual basis.The data, released by the Australian Bureau of Statistics on Wednesday, suggests that while more people are getting into work, with 240,000 jobs created over the year, the jobs are also lower paid on average.Capital Economics chief economist Paul Dales said the wage figures were even worse when broken down to average employee compensation per hour.Annual growth in compensation per hour fell over the June quarter from 1.1 per cent to negative 0.3 per cent, the weakest growth in almost 25 years.While the hourly figures are volatile, the Reserve Bank last year cited strong compensation growth per hour as a cause for optimism in the face of persistent low wage growth.Mr Dales said that "there is no evidence whatsoever that wage growth has started to rise as the RBA expects".Professional and technical services, covering engineers and IT workers, as well as health care drove the overall growth in the nation's wages bill.