The Wage Price Index is growing in the public sector, but not so much in the private sector. Photo: File.
Public sector wages are growing faster than those in the private sector, according to data just released by the Australian Bureau of Statistics.
The ABS’s seasonally adjusted data shows that overall the Wage Price Index (WPI) rose 0.9 per cent in the March quarter 2025 and 3.4 per cent annually.
In the private sector for the quarter, however, wages rose 0.9 per cent while public sector wages rose 1.0 per cent.
Seasonally adjusted private sector annual wage growth was unchanged from the December quarter at 3.3 per cent.
Annual public sector wage growth was higher than the private sector at 3.6 per cent in the March quarter 2025, up from 2.9 per cent in the December quarter 2024.
Michelle Marquardt, ABS head of prices statistics, noted that annual wage growth had ticked up for the first time since the June quarter of 2024.
“The 3.4 per cent increase in wages for the year to the March quarter 2025 was higher than the 3.2 per cent to the December quarter 2024, but lower than the 4.0 per cent at the same time last year,” Ms Marquardt said.
“Private sector wage growth was also influenced by administrative wage adjustments due to the Stage 3 Aged Care Work Value Case, and the Early Childhood Education and Care Worker Retention Payment.
“It was also impacted by regular March quarter wage and salary reviews. Wages growth in the public sector was impacted by new state-based enterprise agreements, and to a lesser degree, increases paid to aged care workers.”
The new state-based enterprise agreements in the public sector mainly drove the larger-than-usual March quarter contribution from enterprise agreement-covered jobs.
Enterprise agreements across sectors were the main contributors to the wages growth.
“Jobs covered by enterprise agreements contributed to over half of all quarterly growth, for the first time since September 2020,” Ms Marquardt said.
Healthcare and social assistance, as well as education and training, were among the sectors experiencing the largest gains.
Workers from these sectors have benefited from significant wage increases and changes in the federal government’s workplace relations.
The Australian Council of Trade Unions said the latest data highlights the importance of the newly introduced rights in improving workers’ living standards.
ACTU president Michele O’Neil said Australian Unions argue that a 4.5 per cent minimum wage increase is essential for supporting Australia’s lowest-paid workers and lifting the wage floor for the broader workforce.
“Today’s wage data is the clearest sign yet that working people are getting ahead after a decade of wage suppression and global inflation,” Ms O’Neil said.
“Improved collective bargaining rights and fair pay won by union members under the Albanese government are delivering real results for nurses, teachers, early childhood educators and aged care workers.
“There’s still a way to go, but today’s data shows the importance of having more working people able to bargain over their wages and conditions.
“The upcoming Annual Wage Review will be an important opportunity to continue this progress. Working people should feel valued for their work and have the certainty to plan for their future.
“Building a more balanced and resilient economy means backing lifting real wages to support workers and their families and giving local businesses the confidence to grow.”
Ms O’Neil said the rise was driven by strong wage increases for workers paid under collective agreements.
It is the clearest sign yet that working people’s incomes are finally being restored after years of going backwards, she added.
The Fair Work Commission’s Annual Wage Review decision is expected in early June and will directly impact more than 2.6 million workers on minimum and award wages.
March quarter 2025 WPI data captures wage information for the mid-month (February) of the March quarter.
The WPI is designed to measure the change over time in the price of wages and salaries; that is, a pure price change unaffected by the changes in the quality or quantity of work performed or the composition of the workforce.
