AUSTRALIA

AUSTRALIAN ECONOMY Australia Main Index

HISTORY OF WAGE INCREASES

CONSUMER PRICE INDEX

The CPI measures quarterly changes in the price of a basket of goods and services which account for a high proportion of expenditure by the CPI population group (ie metropolitan wage and salary earner households).
This basket covers a wide range of goods and services arranged into 8 groups:

food, clothing, housing, household equipment & operation, transportation, tobacco & alcohol, health & personal care and recreation and education.

How to calculate changes in CPI between two periods:

All Groups CPI: Weighted average of 8 capital cities Index Nos:
        Mar quarter 1995   114.7
   less Dec quarter 1994   112.8
   change in index points    1.9

  Percentage change     100 x 1.9 / 112.8  = 1.7%

AWE AVERAGE WEEKLY EARNINGS

        CPI     AWE       AWE is average of all wages and salaries
1991    3.2%    5.4%      paid in the year, does not include over-
1992    1.0%    3.3%      time or penalties.
1993    1.8%    2.1%
1994    1.9%    3.4%
1995    5.1%

Prior to Enterprise bargaining, wages generally increased by way of National Wage Cases (NWC). All awards moved at the same time.

 Date      Reason            Increase
 29-08-91  NWC CPI Increase    2.5% 
 07-08-89  NWC CPI Increase    3.0% or $15.00
 01-03-89  NWC CPI Increase  $10.00
 01-08-88  NWC CPI Increase    3.0%
 05-02-88  NWC CPI Increase  $ 6.00
 01-09-87  NWC CPI Increase    4.0%
 10-03-87  NWC CPI Increase  $10.00
 26-06-86  NWC CPI Increase    2.3%
 05-11-85  NWC CPI Increase    3.8%
 06-04-85  NWC CPI Increase    2.6%
 06-04-84  NWC CPI Increase    4.1%
 06-10-83  NWC CPI Increase    4.3%

LIVING WAGE CASE 1997

On 22 April 1997, The Australian Industrial Relations Commission granted a $10.00 per week wage increase to those who had not received an increase through bargaining.
A new federal minimum award wage was set at $359.40 for a 38 hour week.
The ACTU had sought an increase of 8.75% and a further $20.00 safety net increase.

The decision will be seen as a turning point in our social history. We have now adopted the US position of encouraging the creation of the "working poor". The working poor are workers with a full time job but are still paid below the poverty line. This forces the worker to take a second job and/or forces the spouse to take a job, merely to earn enough to get above the official poverrty line.
Those who admire family values are very disappointed.

LIVING WAGE CASE 1998

On 29 April 1998, The Australian Industrial Relations Commission handed down the Safety Net Review Wages April 1998 decision [Print Q19980].

The IRC granted:
* a $14.00 per week wage increase to those earning below $550
* a $12.00 per week wage increase to those earning between $550 and $701
* a $10.00 per week wage increase to those earning above $700

The increase applies to those who had not received an increase through bargaining since 1 Nov 1991.
A new federal minimum award wage was set at $373.40 for a 38 hour week or 9.83 per hour.
The ACTU had sought an increase of $20.60 per week safety net increase.
The family friendly Liberal Government argued that the increase should be only $8.00 per week. Minister Reith stunned everyone by saying that it was a win for the "battler". His comments surely confirm that the Government was attacking the battler in the case.

LIVING WAGE CASE 2000

On 29 April 1998, The Australian Industrial Relations Commission handed down the Safety Net Review decision on 1st May 2000. It granted a $15.00 increase to the minimum wage for full time employees, raising it from $385.40 to $400.40. The ACTU had sought an increase of $24.80 per week safety net increase.
The family friendly Liberal Government argued that the increase should be only $8.00 per week.