Nearly 3 million Australian workers are about to get a little less poor, after the Fair Work Commission decided that the current minimum wage was, in fact, not quite enough to survive on. The Commission handed down a 4.75% pay rise for roughly 2.8 million workers on award wages, while about 100,000 of the country’s lowest paid will receive a higher 6% increase.
Announcing the decision on Tuesday morning, Fair Work Commission president Justice Adam Hatcher revealed that the lowest ongoing wage rate would climb from nearly $24.95 an hour to $26.44 - a lift of just under 6%. Hatcher called this year’s decision “particularly challenging,” which is what you say when surging fuel prices are adding to already existing inflationary pressures and you’re trying to figure out how to make math work that clearly doesn't.
Hatcher pointed out that falling living standards had hit the lowest paid the hardest, justifying what he termed “additional measures” to protect more vulnerable employees. The higher increase for the lowest paid reflected a “structural adjustment” to pay classifications, which is fancy talk for “they needed it more.”
Unions had demanded a 6% minimum wage increase after last month’s budget projected inflation reaching 5% in the year to June. Meanwhile, the Australian Chamber of Commerce and Industry, a peak employers’ association, was calling for a 3.5% increase - because apparently they believe in the magical power of less money to solve cost-of-living problems.
The cost of living has been the No 1 issue weighing on Australian households since inflation tore through the economy in the wake of the Covid-19 lockdowns. The previous minimum wage increase was 3.5% for 2025-26. Inflation was 4.2% in the year to April, according to the latest Australian Bureau of Statistics figures, and the budget also predicted consumer price growth could push beyond 5% should the Middle East conflict extend and oil prices climb higher for longer.
With the Reserve Bank warning it may have to hike interest rates further to squash any signs an inflationary mindset has taken hold of the country, Treasurer Jim Chalmers has called for a “real” wage increase but added that it also needed to be “sustainable.” Because apparently, in the great Australian balancing act, workers getting enough to live on is the thing that might tip the scales.