The Morrison government has cautioned that increasing Australia’s minimum wage this year could constrain small business recovery and employment.
“The risk of domestic outbreaks and ongoing disruptions to other major economies mean the economic environment remains uncertain,” the government stated.
“Although the vaccine rollout is underway, COVID-19 outbreaks that would necessitate further containment measures remain a significant risk.”
In response to the call, the Australian Council of Trade Unions (ACTU) is arguing for an increase of 3.5 percent, or $26.38 per week, for a full-time minimum wage worker.
The ACTU argued that one-fifth of Australian workers receive the minimum wage and rely on the Commission’s annual review for pay increases.
The increase of 1.75 percent last year, which was delayed three months for 75 percent of recipients, meant Australia was falling behind other countries, such as the UK and New Zealand in “establishing a living wage at 60 percent of median income.”
“Everyone suffers if wage growth doesn’t bounce back. If minimum wage workers do not have money to spend, local businesses feel it the most.”
The National Farmer Federation (NFF) and Business NSW, one of the state’s top employer organisations, called for a freeze in minimum wage increases this year.
“The NFF calls for the current minimum wage level to be maintained in order to minimise the financial pressure on agricultural businesses,” the Federation said in its submission to the annual wage review.
The NFF argued that the drought, the bushfires last year, and the pandemic have hit hard on many farm businesses. At the same time, labour costs make up a big proportion of total cost in agriculture, especially for horticultural producers.
“This will provide affected farms with some time and capacity to recover from recent adversities and protect the productivity and viability of the agricultural sector,” the Federation said.