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Australia's minimum wage to rise by 3% from July 1
[SYDNEY] Australia's industrial relations umpire raised the national minimum wage by 3 per cent from July 1, it said on Friday following an annual review, an increase more than double the inflation rate but half of what unions had lobbied for.
The pay hike, which is above the industry rate of 2.3 per cent, will be welcomed by central bank policymakers who have long argued that faster pay growth was needed to lift inflation and consumption.
Reserve Bank of Australia (RBA) Governor Philip Lowe has long called for average annual wage increases of above 3 per cent to achieve average inflation of 2.5 per cent, the mid-point of its target band.
The new national minimum wage will now be A$740.80 (S$708) per week, or A$19.49 per hour, Fair Work Commission President Justice Iain Ross said.
This would amount to an increase of A$21.60 per week.
The FWC has also decided to increase all modern "award" minimum wages by 3 per cent.
Thursday's move affects about 2.3 million employees, or 20 per cent of Australia's workforce, and was opposed by business groups which argued that higher pay awards would kill jobs.
"We are satisfied that the level of increases we have decided upon will not lead to any adverse inflationary outcome nor will it have any measurable negative impact on employment," Mr Ross said.
"However, such increases will mean an improvement in the real wages of those employees who are reliant on minimum wages and an improvement in their living standards."