Australia’s Wages Climbed 4.1% in July, New SEEK Index Shows

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As a tight labor market forces employers to pay more for staff, a new gauge of advertised salaries in Australia shows a long-awaited acceleration in wage growth.

There was a 4.1% increase in salaries in July from a year ago. The wage price index rose 2.5% last quarter.

The SEEK index and government wage measure were climbing at the same rate prior to the swine flu.

As the Great Job Boom continues, observers have wondered when wages and salaries will start to increase. They already have advertised salaries for vacancies.

As it began raising interest rates in May, the Reserve Bank of Australia cited readings from liaisons with firms. While inflation is the primary driver of the 1.75 percentage points of hikes since then, the central bank expects wage growth to underpin price gains in the future.

The pickup in advertised salary growth has been broad based, unlike previous labor market booms where only some parts of the economy benefited.

The advertised salary growth is greater than 3% for most jobs.

In the Australian Capital Territory, advertised full-time equivalent salaries are higher than in the rest of the country. The lowest advertised salaries were in South Australia.

Growth for government jobs was weakest, with annual salary increases of less than 1%.