What this measures
Wage growth tracks how fast pay rates are rising across the economy, measured by the ABS Wage Price Index (WPI). Unlike average earnings, the WPI holds job mix constant, so it isolates the pure price of labour rather than shifts in who’s working.
How to read this figure
Four kinds of change are held constant here, and between them they account for most of what makes a real pay packet move. Changes in the nature of the work. Changes in its quantity, meaning hours. Changes in the characteristics of the person doing it, a list that expressly includes age, apprenticeship year, completion of training or a qualification, grade or level, experience and length of service. And changes in where the work is done. Field staff contact employers to establish whether a price change came from one of these rather than from market forces, and remove it if it did. So a promotion, a new qualification or a long-service increment is invisible in this figure, not because the survey missed it but because removing it is what the survey is for.
One exclusion is worth stating precisely, because it is commonly got wrong. The headline series is total hourly rates of pay excluding bonuses. Total means ordinary time plus overtime, so overtime is inside the headline; it is bonuses that are out. Separate ordinary-time variants exclude overtime, and separate including-bonuses variants put bonuses back.
Revisions behave in the opposite way to the national accounts, where a single release can rewrite four years of history. Original index numbers here are released as final when first published and revised only in exceptional circumstances. It is the seasonally adjusted and trend series that move as further quarters arrive.
The figure reaches a household through the comparison this page does not make on its own. Whether pay has kept up is wage growth set against inflation, and the two series are built on opposite principles: this one strips out everything about a person that changed, while a household's actual income includes all of it. So the published gap between wages and prices describes the price of a fixed job, not the fortunes of anybody holding one, and an individual whose grade or hours changed will have done better or worse than the gap suggests.
The cadence is quarterly, and its reference point is narrower than the quarter. The reference date is the last pay period ending on or before the third Friday of the middle month, and publication follows about three months after that date. The figure therefore describes pay as at a specific mid-quarter moment rather than an average across three months.
Longer read: Two wages series, and who sets Australian pay. Australia publishes two wages series that answer different questions. One removes everything about a person that changed; the other keeps all of it. Reading the first as a description of household income is the mistake, and it is built into the design of the measure.
Related indicators: Unemployment rate · GDP growth · Mean house price - or the whole set on the Australian economy hub. To put this figure to work on your own numbers, use the inflation calculator. For how figures like this feed into the exchange rate, read what moves the Australian dollar.