CANBERRA: Wages of Australian workers have grown at their weakest rate in almost two decades, adding weight to the perception that incomes are falling behind the cost of living.
Annual wages growth slipped to just 2.2% in 2015, according to figures released by the Australian Bureau of Statistics on Wednesday – the slowest growth since its wage price index was introduced in 1997. It was only just above the inflation rate of 1.7%.
Combined with figures showing weak engineering construction, the numbers helped to push Australian shares down sharply with a sell-off in mining and banking stocks taking the ASX/S&P 200 down by 104 points, or 2.1%, to 4,875. A recent study by Essential Research found just over half of its respondents believe their income has fallen behind the cost of living.
Justin Fabo, an economist at ANZ bank, expected wages growth to remain subdued given the relatively high level of unemployment, low-inflation expectations and downward pressure on national income from a declining terms of trade.
