In the past year real wages fell so far they are now back to 2012 levels.
The June wage prices price index data released by the Bureau of Statistics today confirms that real wages have fallen faster than they ever have on record.
The 3.3% fall in the past year is even greater than the 2.8% fall that occured when the GST was introduced in 2000.
This means that real wages are now 3.6% below where they were at the start of the pandemic and the Reserve Bank predicts they will fall even further with inflation set to grow by 7.8% by the end of the year and wages expected to perhaps only reach 3% growth.
In overall terms people’s ability to purchase items is back at 2012 levels.
For lower income households, the damage is much greater. While overall inflation in the past year has increased by 6.1% compared to the 3.6% growth of wages, the prices of non-discretionary items have risen 7.6%.