Australian Public Service employees miss out on real pay rise for years

And as COVID tore through the economy in 2020 and 2021, forcing whole industries to shut down, having a public service position seemed about the best spot to be in unless you were into manufacturing face masks, ran a food delivery business or knew how to make vaccines.

But figures obtained from the Australian Public Service's annual remuneration survey show that for the past decade public servants have paid a high price for the privilege having a job unlikely to disappear at any moment.

In essence, workers on the public payroll - aside from those in the Senior Executive Service - haven't had a real wage rise in a decade. In fact, their pay has gone backwards.

This is unlikely to come as a surprise to most in the APS, and workers in the private sector have not fared much better.

While inflation was low and interest rates were rock bottom, the pain of real wage stagnation (or worse) was manageable.

But that picture has changed radically, and not in a good way.

The huge disruption to global demand and supply chains caused by the pandemic and the energy and food crisis caused by Putin's disastrous invasion of Ukraine have helped send inflation spirally up to 7.3 per cent at the latest count. In response, the Reserve Bank of Australia has moved aggressively to raise its cash rate by 300 percentage points to 3.1 per cent in the space of eight months.

Everything from housing to energy, food and fuel has become more expensive. Unsurprisingly, households are hurting, and having a job is no easy ticket out of the pain.

Treasurer Jim Chalmers has seized on Wage Price Index figures showing wages in the September quarter were 3.1 per cent higher than a year earlier. He says this is the first glimmer that the tight jobs market and measures like last October's 4.5 per cent lift to the minimum wage are starting to work.

But while workers in the private sector are starting to see some more promising gains (their wages in the three months to September were, on average, up 3.4 per cent from a year earlier) for those in the public sector the equivalent increase was a measly 2.4 per cent.

In fact, the last time public sector wages outgrew those in the private realm was in December 2020.

Either way, with inflation at 6 per cent and higher, both sets of workers are, in effect, going backwards. Inflation will eventually come down, but there will be a lot of pain in the meantime.