Public service wages grew by 2.2 per cent last year, the slowest annual growth since records began more than 20 years ago.
In the three months to December, public sector wages grow more slowly than wages in the private sector, although over the year, the increase was the same.
In the ACT the picture was worse. The ACT recorded the lowest wage rise in the country over the December quarter, at just 0.2 per cent.
Over the year, private sector wages in Canberra grew strongly compared with other states, at about 2.7 per cent. But, the performance of public sector wages was worse, growing just 1.9 per cent in the ACT, well behind Victoria and NSW.
Canberra's public sector wages have been stagnant for some years, growing at less than 2 per cent a year for five years. The heyday of public service pay was in the five years from 2004, when wages grow more than 4 per cent a year.
The Coalition has imposed a 2 per cent cap on annual wage rises in the public service since 2014. The ACT doesn't have a wage cap, but most jurisdictions do.
Reserve Bank governor Philip Lowe has blamed the wage cap for suppressing wages across the board.
He told a parliamentary inquiry in August last year that the caps were "cementing low wage norms across the country".
"The norm is now 1 to 1.5 per cent and partly that's coming from the decisions that are being taken by the state governments," he said.
Commonwealth Bank analysis shows that wage growth is higher in health and government administration than in other areas of the public sector, especially education and communications.
Bank senior economist Kristina Clifton said while there was some evidence for Dr Lowe's argument that caps on public service wages spilled over to slower growth in private firms, the main reason for low wages growth was the spare capacity in the labour market.
A long period of low inflation also likely to be contributing.
"When inflation is low and expected to remain low people are less likely to push for stronger wage increases. And low wages growth keeps a lid on inflationary pressures. It becomes difficult to get out of this cycle," she said.
Annual wage growth was well short of the 3 per cent or more figures that would have been considered "normal" in the past, she said.
National secretary of the Community and Public Sector Union Melissa Donnelly said public services provided the foundation for growth and prosperity for the nation.
"We know that the public sector wage cap has halted economic growth across all sectors nationally. And our members have been making a strong public case for fairer wages in the public sector and have won support from unlikely allies including the governor of the Reserve Bank," she said.
Labor treasury spokesman Jim Chalmers said wage growth had fallen short of budget forecasts, which were downgraded only two months ago.
The government's "spectacular failure" made a mockery of Treasurer Josh Frydenberg's claim that wages growth was "a core focus" for the government, he said.
"No wonder so many Australians feel like no matter how hard they work they just can't get ahead."