Millions of Aussies set for a payrise
<p>Millions of low-paid Australian workers will receive a wage boost from July 1, after the Fair Work Commission (FWC) announced a 3.5 per cent increase to minimum and award wages.</p>
<p>The decision affects around 2.9 million workers and will lift the national minimum wage from $24.10 to $24.94 an hour – a weekly increase of nearly $32 for full-time employees.</p>
<p>The FWC’s ruling strikes a middle ground between competing demands from unions and business groups. The Australian Council of Trade Unions (ACTU) had pushed for a 4.5 per cent rise, citing the need to help workers keep up with the cost of living, while employer groups including the Australian Chamber of Commerce and Industry had argued for a more modest 2.5 per cent hike.</p>
<p>The 3.5 per cent rise is slightly below last year’s 3.75 per cent decision, but still exceeds the current annual inflation rate of 2.4 per cent. With the Reserve Bank forecasting inflation to rise to 3.1 per cent by mid-2026 as government energy subsidies wind down, the FWC’s decision offers workers a modest real wage increase.</p>
<p>ACTU Secretary Sally McManus said the decision was a lifeline for workers living paycheque to paycheque. “When you’re on those wages, you’re not saving money. Everything you earn, you spend,” she said. “It’s about whether you can keep up with your bills or not, whether your life gets slightly better, stays the same, or goes backwards.”</p>
<p>The ACTU had argued that sustained low wage growth in recent years had left many workers falling behind, and that the time had come for wages to catch up. McManus pointed to productivity improvements in sectors such as hospitality and retail – where many award-dependent workers are employed – as justification for a stronger rise.</p>
<p>“The commission previously has said, ‘yes, these workers need to catch up, we’ve just got to wait for the right time’. We say now is the right time,” she said.</p>
<p>But employer groups warned the decision will pile pressure on businesses already grappling with rising costs and weak consumer spending. The Council of Small Business Organisations Australia, representing many of the nation’s cafes, restaurants and retail stores, argued a 4.5 per cent jump could have triggered job losses or even business closures.</p>
<p>“Anything higher than 2.5 per cent would place unsustainable pressure on small businesses, potentially leading to reduced employment opportunities, business closures, and broader economic harm,” the council said in its submission.</p>
<p>The federal government stopped short of recommending a specific number, but called for a “sustainable” increase that would keep wages ahead of inflation without undermining economic stability.</p>
<p>AMP chief economist Shane Oliver had forecast the 3.5 per cent increase, suggesting it would give workers a real wage gain without fanning the flames of inflation. “It strikes a balance between supporting household spending power and avoiding a wage-price spiral,” he said.</p>
<p>While union leaders expressed disappointment that the rise wasn’t higher, the decision is broadly seen as a compromise designed to support both workers and businesses amid a fragile economic recovery.</p>
<p><em>Image: Shutterstock</em></p>