The WPI shows public sector wages surpassing those of the private sector. Photo: File.
Public sector wages are outpacing those in the private sector, according to recently released Australian Bureau of Statistics (ABS) figures.
This is being driven more from state and territory government wages than by those in the Commonwealth public sector.
Annual public sector wage growth was 3.8 per cent in the year to September quarter, slightly up compared to 3.7 per cent at the same time last year.
On a quarterly and annual basis, public sector wages grew at a faster pace than the private sector for the third consecutive quarter.
Seasonally adjusted private sector wages grew 0.7 per cent for the quarter, while public sector wages rose 0.9 per cent.
The Wage Price Index (WPI) rose 0.8 per cent in the September quarter 2025, showing workers’ wages overall to be just keeping ahead of inflation, which rose to 3.2 per cent over the same period.
The quarterly growth was in line with the June quarter 2025 and September quarter 2024.
Private sector wages grew 3.2 per cent over the year to September 2025 compared to 3.5 per cent growth recorded in the year to September 2024.
ABS head of prices statistics, Michelle Marquardt, said several factors influenced the latest WPI.
“Annual wage growth to the September quarter 2025 was 3.4 per cent. Annual wage growth remained steady compared to the June quarter 2025 but was slightly lower than this time last year,” she said.
“State government pay rises contributed 82 per cent of public sector wage growth this quarter.
“This September quarter, 47 per cent of private sector jobs saw a change in their wages compared to 49 per cent in the same quarter last year.”
The average size of hourly wage change was also lower in September quarter 2025 (up 3.6 per cent) compared to the same period in 2024 (up 3.9 per cent).
Federal Treasurer Jim Chalmers said it was a good sign that wages across the spectrum were continuing to move in the right direction, and that at a federal level the comparison between the public and private sector was slightly different.
“I would say it’s incredibly encouraging news and we have now had two consecutive years of annual real wages growth,” he said.
“Eight quarters in a row of real wages growth, remembering real wages were falling substantially when we came to office, that is overwhelmingly a good thing.
“When it comes to the public versus private breakup, since we’ve been elected, the private sector wages growth has outstripped public sector wages growth.”
The ABS’s latest labour statistics also showed total wages and salaries paid by employers were $108.8 billion in September 2025, up 5.3 per cent from September 2024.
Sean Crick, ABS’s head of labour statistics, said the total wages and salaries paid by employers rose by $5.3 billion in the three months from June 2025.
“This repeats the seasonal pattern we’ve seen in previous years as some industries pay bonuses in September,” he said.
“Annual growth in total wages and salaries to September 2025 was 5.3 per cent, lower than the annual growth to September 2024 of 6.1 per cent.”
All 19 industries covered by the data saw a rise in total wages and salaries paid by employers between August and September 2025. The strongest rises came from five industries that paid periodic bonuses in September – mining; electricity, gas, water and waste services; retail trade; information media and telecommunications; and financial and insurance services.
Except for retail trade, these industries also pay periodic bonuses around February and March.
Together, these five industries accounted for more than half of the monthly rise in wages and salaries to September 2025 (57 per cent or $2.2 billion), despite representing less than one quarter of the total wages and salaries paid.
