Australia wage growth eases to 3.2% as higher pay rises become less common

Australia’s annual wage growth slowed to 3.2% in the June quarter of 2026, as fewer jobs recorded larger pay increases, according to the latest data from the Australian Bureau of Statistics (ABS).

The Wage Price Index (WPI) rose 0.8% over the quarter, taking annual growth slightly below the 3.4% recorded a year earlier.

Fewer jobs see larger pay rises

The slowdown was partly driven by a decline in jobs receiving bigger wage increases.

Only 14.3% of jobs recorded an annualised wage increase of between 4% and 6%, down from 17.8% in the June quarter of 2025.

The share of jobs with wage increases above 6% also fell, to 6.7% from 7.3% a year earlier.

"The decline in the share of jobs with larger wage rises has contributed to slower wage growth overall," ABS head of prices statistics Rachael McCririck said.

Meanwhile, 79% of jobs recorded annualised wage growth below 4%, up from 75% a year earlier. It was the highest proportion recorded by the ABS since June 2022.

Wage growth remains above pre-pandemic levels

Despite the moderation, wage growth remains well above the levels seen before the COVID-19 pandemic.

"Annual wage growth of 3.2% is slightly down from 3.4% at the same time last year," McCririck said.

"Although we're currently below the late 2023 peak of 4.3%, annual wage growth remains above the 2.2% that we were seeing in the December quarter 2019 prior to the COVID-19 pandemic."

The ABS said 4.1% of jobs recorded a wage cut during the June quarter. Another 14.2% recorded annualised wage growth of between zero and 2%.

Around 21.2% of jobs recorded wage increases of between 2% and 3%, while 39.5% recorded increases between 3% and 4%.

Public sector continues to lead growth

The public sector remained the main driver of annual wage growth, with wages rising 3.4% compared with 3.1% in the private sector.

Public sector wage growth has outpaced private sector growth for the sixth consecutive quarter.

"Rises paid to state government public service jobs were the main driver of public sector growth, supported by scheduled rises paid under the existing APS-wide enterprise agreement for Commonwealth employees," McCririck said.

The latest figures point to a gradual easing in Australia's wage pressures, although pay growth remains stronger than before the pandemic.