The latest detailed data employment data has revealed that in 2017 full-time median earnings rose by less than inflation as the low wages growth problem flowed through all segments of employment while at the same time the levels of casualisation continue the trend upwards.
Last year, median full-time earnings was $65,577 – a 1.5% increase on the $64,584 recorded in 2016. But that 1.5% growth in the 12 months to August last year was below the 1.8% increase in inflation in the 12 months to September. This marked the third year since 2012 that full-time median earnings had not kept pace with inflation:
Partly the cause is the increase in the number of women working full-time. Women as a general rule earn less than men even when working full-time.
Across Australia, median full-time earnings for men is 13% higher than for women. Last year the median full-time earnings for women was $61,724 compared to the men’s $69,784. The biggest difference was in the Western Australia, where male full-time median earnings of $78,000 was 20% above women’s $65,000 median:
And thus when more women move into full-time work, it lowers the overall median full-time income.
But even when we look at the growth of median earnings by gender and by full-time or part-time status, we see that growth in 2017 was well below the average that occurred from 2005 to 2012, when the wages growth began to fall to the current near record low levels:
Only the median earnings for part-time women saw an increase above the 2005-2012 average – and even that only occurred after two years where there was no increase at all.
These annual figures also allow us to compare the difference between average earnings and median ones, to show just what “middle Australians” are earning.
Because high incomes skew average earnings higher, talking of average earnings as what “middle incomes” gives a distorted picture – which is helpful when suggesting for example that raising the second highest income tax level from $80,000 to $87,000 was helping such middle Australia. Such was the case when Malcolm Turnbull in 2016 argued that “middle income Australians, those that are on average full time earnings, which as you know is nudging $80,000 …”.
And he is right about full-time average earnings – they are currently $84,661, but “middle income Australians” are earning nowhere near $80,000, let alone the new threshold of $87,000.
In 2017, the median full-time earnings in people’s main job (thus excluding those who work more than one job) was $65,577, and for all workers – both full-time and part-time – the median earnings was $52,988:
The data also shows that the biggest gaps between men and women’s full-time earnings occur at high incomes.
While the median full-time income for men is 13% higher than the median for women, the amount earned by men among the top 10% is nearly 20% more than is earned by the top 10% of women working full-time:
Because of the higher proportion of women working part-time the gap is accentuated when looking at overall earnings. The median earnings for men of $62,400 is a third higher than the $46,800 median earnings for women.
The biggest earnings disparity occurs in the professional, scientific and technology industry, while the smallest gap occurs in the public administration and safety industry – reflecting the better gender diversity hiring practices within the public sector.
The data also showed that the level of casualisation remains a growing concern.
Whereas throughout the first decade of this century the percentage of women working casual slowly fell, since 2012 it has been on the rise. As the level of men working casual has been rising for 25 years, this has meant that the overall level has risen since 2012 from 23.5% of all employees to 25.1% last year – the equivalent of around 155,000 more workers being employed on a casual basis:
Casual workers are also more likely to be employed in industries with lower skill levels.
For example not one of the industries with above average levels of employees with bachelor degrees or five years worth of industry experience has above average numbers of casual workers.
Such workers are also much more likely to be working on weekends, with 30% of all casual employees working both weekends and weekdays, compared to 21% of employees who are employed with leave entitlements:
But for all workers, casual or not, the latest data only serves to reinforce how stagnant living standards have been over the past five years and will only add fuel to fire of the debate over how to solve the problem.