Stuck in neutral: the policy architecture driving slow wages growth in Australia

Wages growth Economic indicators Policy analysis Wages Australia

Australian workers are enduring a sustained period of low wage growth, in both the private and public sectors, in all Australian jurisdictions. Slow wage growth is an economic problem created at least in part by deliberate government policy.

Remedying sustained low wage growth requires substantial change in federal government policy. Yet the current Morrison Government continues to enact a suite of policies that have contributed to slow wage growth, and to the real wage reductions forecast in the 2021-22 Budget.

This report examines the features of that economic architecture, identifying seven policy positions and priorities that the federal government has pursued that are contributing to sustained low wage growth, and will continue to suppress wage growth if not addressed. The report begins by describing trends in wage growth in Australia over the last 13 years. It then identifies the policy positions of the federal government since assuming office in 2013 that have contributed to slow wage growth.

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