Labor backs in minimum wage increase for 2.7 million Aussies
Labor has backed a wage increase for 2.7 million minimum wage earners as the Fair Work Commission deliberates on further pay rises.
On Thursday, the Albanian government submitted to the Annual Pay Review that the commission should provide information on “economically sustainable real pay growth” for Australian reward workers.
About 2.7 million Australians – or about a quarter of the country’s workforce – are working on the national minimum wage or on bounty.
Employment Minister Amanda Rishworth said low-paid workers were more exposed to “unexpected financial shocks” and experienced greater financial distress.
“Our government believes that millions of baristas, maintenance workers, clerks and cooks need to move forward,” he said.
“Given that women are disproportionately represented in reward-based jobs, an increase in the minimum wage could also play a role in closing the gender pay gap.”
Finance Minister Jim Chalmers said workers were doing a tough job and needed sustainable real wage growth.
“With fuel prices rising and pressure on families increasing, we are helping cover living expenses in a responsible way,” he said.
“This, along with all the support we offer such as tax cuts and cheaper medicines, will help millions of workers in low-paid and reward-based jobs cope with these rising costs.”
The government does not set the minimum wage, nor does it recommend a specific amount.
But this would mark an increase consistent with underlying inflation returning to the Reserve Bank of Australia’s target range of 2-3 per cent in 2026-27, which would provide relief to workers.
The Fair Work Commission will decide in the coming months on any increase in the minimum wage, which will come into force from 1 July.
The minimum wage is now $175.40 per week higher than when the Albanian government takes office in 2022.
The impending decision comes against a backdrop of renewed economic turmoil, with the Iran war driving up fuel prices and putting pressure on family budgets.
While gasoline prices have increased by more than 30 percent on average since February 23, diesel prices have increased by more than 40 percent.
According to statistics published on Wednesday, the Consumer Price Index increased by 3.7 percent in February, decreasing by 0.1 percent compared to the previous month.
The sticky inflation figure has increased the risk of a new interest rate hike.
The RBA raised the official cash rate to 4.10 per cent in 2026, the second consecutive rise, on 17 March.
