"The soaring national wages bill is putting increasing pressure on business balance sheets, which augurs poorly for a return to private sector growth," said Innes Willox, Chief Executive of national employer peak body the Australian Industry Group.
Australian Bureau of Statistics data today shows that since the end of the pandemic, the wages bill paid by non-mining businesses has grown 25.8%. This is well ahead of the 18.3% rise in sales income over the same period.
"With wages growing much faster than income, businesses have had to wear the difference on the balance sheet. There has been no growth in non-mining business profits for the last two years as a result.
"As businesses scale back their investment intentions, the impacts of wages pressures are being felt across the economy. Private sector employment and capital expenditure have both been flat for the last year, at a time when the economy needs them the most.
"Excessive wages growth will have deleterious consequences for the prospects of a durable return to growth. With inflation now having significantly lowered, it is imperative for governments to lead a return to wage moderation across Australia," Mr Willox said.
