Unions and business groups are at odds over how much Australia's minimum wage should increase to alleviate cost of living pressures. The federal government has suggested the annual wage increase needs to keep pace with the economy, with inflation sitting at 4.1 per cent, but has not revealed a specific percentage.
secretary Sally McManus said the lowest-paid workers were the hardest hit by inflation and businesses could afford the 5 per cent rise in wages. "When inflation goes up businesses are able to adjust their prices to protect their margins, but workers' pay does not move so easily," she said. McManus argued this number would not be inflationary. Meanwhile, the Australian Chamber of Commerce and Industry has advocated for an increase of no more than 2 per cent.
chief executive Andrew McKellar said that inflation has been moderating since its peak of 7.8 per cent in 2022 while "business conditions have gotten markedly tougher". "We're seeing investment moving sideways, we're seeing a real sense of pessimism for many in business and importantly, labour demand is also starting to drop away," McKellar told ABC Radio on Tuesday.