Wages for public servants are rising at their slowest rate in decades, after the federal and state governments clamped down on pay increases.
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Figures from the Australian Bureau of Statistics released on Wednesday show public sector wages and salaries grew 0.4 per cent last quarter, while annual growth was 1.5 per cent.
It was the lowest rate since the bureau's wages series began in 1997, in the early phase of the Howard government.
The public sector's sluggish wage growth was most obvious in the ACT, as the territory recorded the lowest annual rise in the nation of 1.3 per cent.
Pay rise delays and low wage increases - both a result of Coalition policies for federal agencies - were causes of the slow wages growth, the bureau said.
The federal government last year delayed public service wage rises for six months, saying Commonwealth bureaucrats must share the economic burden of COVID-19. It has also constrained wage rises with a cap, although recently replaced it with a floating limit tied to private sector pay increases.
Economist Saul Eslake said the federal government's cap on public service pay rises was highly likely to be a factor in the public sector wages growth figures - although not the only one.
State governments also froze wage rises for their bureaucrats last year amid the Covid downturn. Given the larger size of their public sectors, decisions regarding pay by state and territory governments would almost certainly have had a larger influence on the overall public sector wages growth figure than those of the federal government, Mr Eslake said.
Wages nationally rose 0.6 per cent in March quarter 2021 and the annual growth rate was 1.5 per cent, according to the bureau's figures. The private sector's yearly wages growth remained at 1.4 per cent for the second quarter in a row.
The bureau said March quarter 2021's moderate wage rises were influenced by regularly scheduled increases.
"Improved business conditions saw employers revisit wage reviews postponed during the height of the pandemic," it said.
"The phased approach to the delivery of award increases saw jobs in the accommodation and food services, retail trade, arts and recreation, aviation and tourism industries receive rises previously recorded in September quarters."
Asked about the public sector's slow wages growth on Wednesday, Labor's treasury spokesman Jim Chalmers said there was a role for the government to lead on wages.
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"But we need to balance that against all of our other fiscal priorities," he said.
"It's a hard task to strike that balance effectively.
"In the nearest term, the first priority is in some of those other areas we've been discussing which are not necessarily the direct employment but in areas like aged care where wages have been such a substantial problem for a long time."
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