The Fair Work Commission has conducted its annual wage review and has changed the national minimum wage to be $622.20 per week or $16.37 per hour.
“[It] must take into account the performance and competitiveness of the national economy, troche ” reads the report. “[This includes] productivity, business competitiveness and viability, inflation and employment growth.”
From the report, the commission has forecast that employment will increase as growth in the non-resources sector improves and the participation rate is expected to stay at 65%. But the unemployment may also increase.
“The unemployment rate is forecast to increase slightly due to the high Australian dollar and the transition to a less labour intensive production phase in the resources sector,” reads the report.
Relative living standards and the needs of the low paid are taken into account the most by the panel.Even though the tax-transfer system is helpful, according to the commission there is evidence of poverty and low-paid families are experiencing an increase of financial stress.
In regards to employer considerations, the commission has noted that businesses will have to spend extra money on employees. Despite the increase of the minimum wage, the report reminds employers there are other problems for businesses at large.
Richard Clancy, executive director of workplace relations at Victorian Employers’ Chamber of Commerce and Industry (VECCI) believes the government hasn’t considered employers enough.
“While the increase may seem modest, it still represents more than a billion dollars in wages employers will have to find over the course of the next 12 months,” he says. “That’s money that won’t go into business investment and job creation. Once again, [the] government is placing an additional burden on business by expecting it alone to bear the cost of maintaining a safety net for the low paid.”
As stated by Clancy, the changes made by the commission are pressuring sectors of the economy that are already having difficulty such as retail, manufacturing, construction and inbound tourism.
“Who is compensating small business for the many cost pressures they continue to face?” he adds.
Changes commence on 1 July 2013.