From July 1 this year, the national minimum wage will increase by 3.3 per cent.
This means that Australia’s lowest-paid workers will see a weekly pay increase of $22.20, with the minimum wage being raised to $694.90.
This is below the $45/week pay rise the Australian Council of Trade Unions (ACTU) called for, yet higher than the $8.10 to $10.10 that business groups wanted.
“The level of increase we have decided upon will not lead to inflationary pressure and is highly unlikely to have any measurable negative impact on employment,” said Fair Work Commission president Iain Ross.
“It will, however, mean an improvement in the real wages for those employees who are reliant on the national minimum wage and modern award minimum wages an improvement in their relative living standards.”
Ross admitted that the increase will not be enough to lift all minimum-wage employees out of poverty. However, to give an increase of that size would “likely have adverse employment effects on those groups who are already marginalised in the labour market,” said Ross.
The Turnbull government made it clear that it did not support a significant wage increase, stating that pay increases that were not supported by higher productivity would “reduce employment in award-reliant industries”.
Approximately 2.3 million Australians rely on the minimum wage, according to the Fair Work Commission.