Public sector wage growth slows to 7.6% as pay bill hits $249.5 billion

Australia’s public sector pay bill climbed to $249.5 billion in the 2024–25 financial year, marking a 7.6% rise from the previous year, according to new data released by the Australian Bureau of Statistics (ABS).

While the figure reflects continued growth in public sector pay, it represents a slight easing from the 8.0% annual increase recorded in 2023–24. The ABS attributed the rise to a mix of new enterprise agreements and steady employment growth across all levels of government.

“Wages paid to public sector employees totalled $249.5 billion across the Commonwealth, state, territory and local governments,” said Sean Crick, ABS Head of Labour Statistics. “The rise reflected both underlying wage movements and ongoing growth in employment.”

The Commonwealth Government recorded the strongest growth, with total wages up 9.5% to $40.9 billion, slightly below last year’s 10% jump. State and territory governments paid $191.1 billion, up 7.3%, while local governments saw a 6.9% increase to $17.6 billion.

Employment in the public sector also continued to rise, up 3.3% between June 2024 and June 2025. State government employees accounted for 77% of total public sector jobs, while Commonwealth and local governments made up 15% and 8%, respectively.

Nearly 90% of public sector employment was concentrated in three industries—public administration and safety (880,600 jobs; $90.2 billion in wages), education and training (768,300 jobs; $61.4 billion), and healthcare and social assistance (668,600 jobs; $66.2 billion).

Among smaller industries, electricity, gas, water, and waste services recorded the sharpest gains, with a 6.5% rise in jobs and a 17.7% jump in wages to $9.1 billion.

The figures highlight ongoing wage momentum across essential services, even as governments manage fiscal pressures and calls for pay restraint in a higher-cost environment.