Starting to see some signs of stronger wage growth from enterprise agreements

by Greg Jericho


Some recent strong wage growth in enterprise agreements bodes well for workers

Over the past year, there have been some signs of improved wage growth, but mostly that has not come from wages set under enterprise agreements. Finally, we are seeing some signs of catching up. The latest data from the Fair Work Commission reveals that in the last fortnights of July and the first of August wage growth in agreements lodged with the FWC averaged 4% and 4.4%.

The average wages of Enterprise Agreements generally react slower as the agreements take longer to negotiate and also are for longer periods than is the case of individual agreements or awards. Historically however wage growth under enterprise agreements has been higher than the average wage growth across the economy. These latest figures suggest that the normal state of affairs is returning and Enterprise agreements will once again be the best route for workers to receive strong wage rises.

While the 4.0% and 4.4% rises are significant jumps on the 3.1% and 3.6% average growth of the previous two fortnights the overall impact on the 3-month average growth is muted because only a relatively small number of workers were covered by these agreements.

In the last week of July, 14,026 employees were covered and in agreements lodged in the first fortnight of August another 14,197 employees were covered. This compares with the 166,770 employees covered in agreements lodged in the month prior.

But while the number of employees receiving larger pay rises under enterprise agreements remains small it is growing. In the past fortnight, 1,467 workers in the mining industry were covered by an agreement that would deliver 5.4% annual wage growth over 3 years. Similarly, 6,336 workers in health and welfare services are set to receive a 4.7% annual wage growth over the next two years.

Between the Lines Newsletter

The biggest stories and the best analysis from the team at the Australia Institute, delivered to your inbox every fortnight.

Sign up

General Enquiries

02 6130 0530

Media Enquiries

Luciana Lawe Davies Media Adviser

0457 974 636

RSS Feed

All news