Average wages slump in Q4’18

The biggest problem in Aussie macro is weak household cash flow. Today’s Aussie Business Indicators report suggest that things are getting worse — not better.

On the quarter, nominal wages and salaries paid by the private sector grew by a little less than 80bps. This was the slowest pace of growth since March 2017.

Most of this was due to employment growth of a little over 0.6%q/q. If you subtract out employment growth, average wages grew by a paltry 0.1%q/q.

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7 Responses to Average wages slump in Q4’18

  1. nottrampis says:

    So how do we solve this problem?

    Re-regulation of the labour market? I think that even this would not do a lot because of union decline

  2. Rajat says:

    Does that wages and salaries measure include bonuses, which the ABS data suggests have been higher of late? If so, how could they be reconciled?

  3. nottrampis says:

    Hmm,

    It is at full employment in the USA yet wages are still not anywhere near where they should be.

    The other question is how to get the economy hotter. I can’t see how lower interest rates than the present 1.5% wi;l do anything much.

    I favour stronger infrastructure spending.

  4. nottrampis says:

    well they have full employment in the US of A but no wage pressures and therefore no inflation problems.

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