Recent data on wages provides some assurance that wages growth has troughed. The majority of firms surveyed in the Bank’s liaison program expect wages growth to remain broadly stable over the period ahead. Over the past year, there has been a pick-up in firms expecting higher wage growth outcomes.
Some part of that is the effect of the Fair Work Commission’s decision to raise award and minimum wages by 3.3 per cent. Talking to businesses, such as yourselves, suggests that there are pockets where wage pressures are more acute. But, while those pockets are increasing gradually, they remain fairly contained at this point (Graph 6).