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Insights into Low Wage Growth in Australia

Author

Listed:
  • James Bishop

    (Reserve Bank of Australia)

  • Natasha Cassidy

    (Reserve Bank of Australia)

Abstract

Recent low wage growth in Australia appears to be only partly explained by spare capacity in the labour market, the decline in inflation outcomes and the decline in the terms of trade from its 2011 peak. In this article, we present some tentative evidence that the relationship between wage growth and labour market conditions may have changed, and that this may help to explain recent low wage growth. Using job-level micro wage data, we also find that, since 2012, wage increases have been less frequent and wage growth outcomes have become much more similar across jobs.

Suggested Citation

  • James Bishop & Natasha Cassidy, 2017. "Insights into Low Wage Growth in Australia," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 13-20, March.
  • Handle: RePEc:rba:rbabul:mar2017-02
    as

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    File URL: https://www.rba.gov.au/publications/bulletin/2017/mar/pdf/bu-0317-2-insights-into-low-wage-growth-in-australia.pdf
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    Citations

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    Cited by:

    1. Stephen Bell & Michael Keating, 2019. "Low Wage Growth: Why It Matters and How to Fix It," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 52(4), pages 377-392, December.
    2. Isaac Gross & Andrew Leigh, 2022. "Assessing Australian Monetary Policy in the Twenty‐First Century," The Economic Record, The Economic Society of Australia, vol. 98(322), pages 271-295, September.
    3. Tomas Kennedy & Peter Siminski, 2022. "Are We Richer than Our Parents Were? Absolute Income Mobility in Australia," The Economic Record, The Economic Society of Australia, vol. 98(320), pages 22-41, March.
    4. Benjamin Beckers & Anthony Brassil, 2022. "Inflation Expectations in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 55(1), pages 125-135, March.
    5. Natasha Cassidy, 2019. "Low Wages Growth in Australia – An Overview," RBA Annual Conference Papers acp2019-01, Reserve Bank of Australia, revised Jul 2019.
    6. Chew Lian Chua & Tim Robinson, 2018. "Why Has Australian Wages Growth Been So Low? A Phillips Curve Perspective," The Economic Record, The Economic Society of Australia, vol. 94(S1), pages 11-32, June.
    7. Courtney Brell & Christian Dustmann, 2019. "Immigration and Wage Growth: The Case of Australia," RBA Annual Conference Papers acp2019-05, Reserve Bank of Australia, revised Jul 2019.
    8. Dany Brouillette & James Ketcheson & Olena Kostyshyna & Jonathan Lachaine, 2017. "Wage Growth in Canada and the United States: Factors Behind Recent Weakness," Staff Analytical Notes 17-8, Bank of Canada.
    9. Geoff Weir, 2018. "Wage Growth Puzzles and Technology," RBA Research Discussion Papers rdp2018-10, Reserve Bank of Australia.

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