Sluggish salary? Why your recent ‘pay rise’ might not feel like one
If you think a salary increase is overdue, you’re not the only one. Months of inflationary pressures are making it difficult for salaries to cover the costs of daily living.
Consumer Price Index increased by 4 percent Keeping a roof over our heads in the 12 months to May comes with increased costs for driving and buying food for the week.
It’s no surprise that pay satisfaction has fallen as half of workers believe they’re underpaid despite admitting they’ve received a pay rise, according to recruitment agency Hays.
The Hays Salary Guide has found that although many professionals received pay rises last year, pay growth has failed to keep pace with workers’ expectations and cost of living pressures. One good sign was that minimum wage workers had a very slight wage increase recently.
Fair Work Commission Increased the national minimum wage to $26.44 per hour (up from $24.95) and $1,004.90 based on a full-time week (up from $948), he explained, low-wage workers need a pay raise.
While economists say the decision to pay an extra $1.49 per hour will not have any material impact on inflationary pressures, the fact that the increase is slightly higher than the Consumer Price Index provides modest relief in the cost of living.
‘Most businesses still want to reward good people and retain talent.’
Charles Liu, founder of Cubic Promote
However, the national minimum wage covers a small part of the total workforce, accounting for 2.8 million workers.
It’s hard to say whether this will translate to everyone else. Many workers hope that the boss will give a pay raise soon. This extra money each week will give us the ability to alleviate some of the financial pressures of daily life.
Charles Liu, founder of promotional products firm Cubic Promote, gave his 30 employees 5 percent pay raises last year, but admits he was looking for evidence that they were deserved. He believes the widening gap between top performers and average performers will continue to grow.
“Conversations were much more closely tied to measurable contribution, revenue impact, leadership and productivity improvements than they were a few years ago,” Liu says.
“Businesses will continue to invest in the people who drive growth, but broad-based wage growth may remain elusive until business confidence improves significantly.”
Wages rose modestly by 0.8 per cent in the March 2026 quarter and 3.3 per cent annually, but this increase has been swallowed up by inflation, leaving our “real” wage growth still in the negative.
nationwide, Earnings average around $200 per week Depending on the state, the national average weekly earnings are $1,611, which doesn’t add up to much in this economy.
HR expert Deepak Singh says minimum wages and movement of employees under the award are largely protected by law. “The problem is that many employers are treating this as a compliance update and not as part of a broader compensation strategy,” he says.
“Many employers are adjusting the floor because they have to, but many have not properly planned for what this means in terms of pay compression, internal equity or their own pay growth story.”
Singh expects fewer changes from the current model for those above reward rates, particularly in the mid- and high-pay ranges.
As businesses invest in tools that can automate reporting, management, analysis and repetitive tasks, there is increasing pressure to ensure that wage growth occurs alongside increased productivity.
“Most businesses still want to reward good people and retain talent. The challenge is that wage increases are now weighed against profitability, operating costs and economic uncertainty much more carefully than before,” says Liu.
Of course, you can take the first step and go to your boss and ask for a salary increase. Don’t cite increased costs as a reason why you deserve a raise.
Recruiters recommend first understanding what parameters your workplace uses to grant salary increases and framing your cash request based on business impact, not effort.
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