The Squiz 

The Fair Work Commission has signed off on lifting minimum and award wages by 3.75% from 1 July – meaning 2.6 million Australians will get at least $33.10 extra in their pay each week. The Commission says the increase is “broadly in line with forecast wages growth” this year, and the rise is just ahead of inflation, which is currently sitting at 3.6%. There are 2 things about that… Productivity gains are hard to come by, so it’s a tough ask to get employers to give workers a significant pay jump if they aren’t getting more bang for their buck. And economists are concerned that any significant increase to Aussies’ pay packets this year – which the Reserve Bank considers a key driver of inflation – could be a factor in keeping inflation higher for longer. 

How’s it been received?

“Fair and prudent” is how some economists have described it… And Westpac economist Justin Smirk pointed out that the decision to raise the minimum wage by a lower amount than anticipated would slow wages growth to 3% by the end of the year, taking pressure off inflation. Also welcoming the increase was unions leader Sally McManus – she wanted a 5% increase but welcomed what was offered. But the decision didn’t please everybody… The Council of Small Business boss Luke Achterstraat said it comes on top of last year’s record wage increase – which had “broken many small businesses” struggling to meet increasing power, rent and running costs. He said the increase “does not add up or bode well for jobs”.

Anything else?

Well, while we have you on the topic of economics… The latest CoreLogic house price data released yesterday shows the value of homes is also going up. Property prices grew by 0.8% across the country in May – the largest monthly increase since October last year. CoreLogic’s Tim Lawless reckons the “common denominator remains a mismatch between housing supply and housing demand”. Here’s a good breakdown of how each city/state housing market is going, but the key takeaway is that Brisvegas has become the second-most expensive city for housing for the first time in 25 years, with a median house value of $937,479. It’s still a fair ways behind Sydney which continues its top-of-the-list position. In the Harbour City, the median value of a house is $1,441,957…