Private sector pay leaps ahead: Economy roundup

Private sector pay rises have moved well ahead of the public service over the past year, average weekly earnings figures released today show.

State governments have come under heavy pressure from their workforces to deliver hefty catch-up pay rises in recent months, culminating in a recent Victorian Government decision to give a rise of up to 15% to its teachers.

That magnitude of the pay hike gave rise to concerns that it could have an inflationary impact, but today’s data puts reasons for all that public sector union agitation into context.

According to the Australian Bureau of Statistics, pay for full-time private sector workers increased 5.3% over the year to February to an average weekly wage of $1098.20.

By contrast, full-time public service wages rose by just 2.8% over the same period, well behind both the private sector and the all-sectors average rise fo 4.8%, although public servants’ average weekly wage is higher at $1215.20.

Whether we see similar figures this time next year could depend on the extent to which the Victorian teacher’s pay rise filters through to other parts of the public sector around the country.

On the markets today, mildly positive sentiment has prevailed this morning to push the S&P/ASX200 up 0.6% on yesterday’s close to 5907.7 at 12.40pm.