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1301.0 - Year Book Australia, 2012  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 24/05/2012   
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Labour

EARNINGS

Information on earnings is used to help evaluate the standard of living of employees and to make policy decisions regarding income redistribution, social welfare, taxation and wage setting. Such information also provides indicators of overall economic performance.

The ABS concept of earnings is based on the definition adopted by the twelfth International Conference of Labour Statisticians in 1973. Earnings refers to remuneration to employees for time worked or work done, as well as remuneration for time not worked (e.g. paid annual leave).

The ABS produces a range of statistics on earnings paid to employees. The regular Survey of Average Weekly Earnings (AWE) and the two-yearly Survey of Employee Earnings and Hours (EEH), both business surveys, provide a number of statistical measures of the remuneration paid to employees. The EEH survey also provides estimates of earnings for employees covered by each of the pay-setting methods (i.e. awards, collective agreements and individual arrangements). Information regarding pay-setting methods is available in the WORKPLACE RELATIONS section of this chapter. The household Survey of Employee Earnings, Benefits and Trade Union Membership (EEBTUM), which is conducted each August as a supplement to the monthly Labour Force Survey, also provides information about the earnings of employees.

The quarterly labour price index (LPI) measures changes in wages and salaries, and other 'non-wage' components that contribute to the cost of employing labour (i.e. annual leave, superannuation, payroll tax and workers' compensation). Unlike earnings measures produced from the AWE or EEH surveys, the LPI measures changes in the price of labour and is unaffected by changes in the quality or quantity of work performed, that is, it is unaffected by changes in the composition of the labour force, hours worked, or changes in characteristics of employees (e.g. work performance). The LPI consists of two components: a wage price index, published quarterly and a non-wage price index, which is available for each financial year. Information regarding the LPI is available in chapter 29 PRICES.


LEVEL OF EARNINGS

Data on the level of earnings reflect the variations between population groups, and across industries and occupations. Changes in the level of earnings are also of interest in reflecting the strength of labour demand and supply.

The AWE survey provides an estimate of the average gross weekly earnings paid to employees by measuring earnings during a one-week reference period in the middle month of a quarter (excluding irregular payments not related to the reference period). Data are collected from the payroll records of a sample of employers.

The AWE survey provides four types of earnings measures. The first is average weekly ordinary time earnings (commonly referred to as AWOTE) for full-time adult employees, which relates to that part of total earnings attributable to award, standard or agreed hours of work. A second measure is full-time adult total earnings, which includes both ordinary time and overtime pay. A third measure is total earnings for all employees (including full-time and part-time, adult and junior). A fourth measure, which was introduced in August 2011 for the reference periods from May 2010 onward, is the average weekly cash earnings series, which is a series of earnings inclusive of amounts salary-sacrificed. For more information on the AWE survey, see Labour Statistics: Concepts, Sources and Methods (6102.0.55.001).

Graph 8.41 shows AWOTE from May 2001 to May 2011. Over the 10-year period, AWOTE for full-time adult male employees increased from $867 to $1,398 (or 61%), while for full-time adult female employees it increased from $733 to $1,150 (or 57%).


8.41 Average weekly ordinary time earnings


In May 2011, male average weekly ordinary time earnings for full-time adult employees (AWOTE) was $1,398 and for females was $1,150. For all employee total earnings, males earned $1,237 and females earned $796 (table 8.42). The difference between male and females total earnings reflects the inclusion of part-time employees (a higher proportion of female employees work part-time) and the inclusion of overtime pay (of which males earn more than females). In May 2011, 46% of female employees worked part-time compared with 16% of male employees.


8.42 AVERAGE WEEKLY EARNINGS—May 2011

Males
Females
Persons
$
$
$

Full-time adult ordinary time earnings
1 397.70
1 150.20
1 304.70
Full-time adult total earnings
1 472.80
1 167.10
1 357.90
All employees total earnings
1 236.50
795.90
1 015.20

Source: Average Weekly Earnings, Australia (6302.0).


Table 8.43 presents AWOTE for full-time adult males and females by states and territories in May 2011. The highest weekly earnings were in Western Australia for males ($1,633) and in the Australian Capital Territory for females ($1,394). The lowest weekly earnings were in Tasmania for males ($1,194) and in South Australia for females ($1,051).


8.43 AVERAGE WEEKLY EARNINGS(a), By state and territory—May 2011

Males
Females
Persons
$
$
$

New South Wales
1 400.10
1 195.10
1 322.20
Victoria
1 342.30
1 113.70
1 255.60
Queensland
1 370.30
1 117.20
1 274.40
South Australia
1 261.50
1 051.00
1 184.20
Western Australia
1 632.60
1 171.70
1 474.10
Tasmania
1 193.80
1 060.50
1 149.80
Northern Territory
1 385.10
1 166.90
1 289.30
Australian Capital Territory
1 570.00
1 393.90
1 494.30
Australia
1 397.70
1 150.20
1 304.70

(a) Full-time adult ordinary time earnings.
Source: Average Weekly Earnings, Australia (6302.0).



In May 2011, the Mining industry recorded the highest AWOTE for full-time adults ($2,181 for males and $1,723 for females) (graph 8.44). The industries with the lowest AWOTE for full-time males were Retail trade and Accommodation and food services ($964 and $979 respectively) and Accommodation and food services and Retail trade ($858 and $907 respectively) for females.

AWOTE for full-time adult females was less than for males in all industries. The largest difference between the earnings of full-time adult males and females occurred in Financial and insurance services and the smallest in Retail trade.


8.44 Average weekly ordinary time earnings, By industry, May 2011



Data on earnings are also available from the EEH survey. This survey provides additional information on employee characteristics such as occupation. Average weekly ordinary time cash earnings (including amounts salary sacrificed) for full-time adult employees by occupation for May 2010 are shown in graph 8.45. For both males and females, Labourers recorded the lowest average weekly ordinary time cash earnings of all the occupation groups ($934 for males and $773 for females). The occupation group with the highest weekly earnings was Managers ($2,026 for males and $1,705 for females).

Males had higher average weekly ordinary time cash earnings than females in each major occupation group. For full-time adult employees, the proportional difference between average weekly ordinary time cash earnings for males and females was smallest for Machinery operators and drivers (average earnings of females were 88% of those of males) and greatest for Technicians and trade workers (female average earnings 79% of male).


8.45 Average weekly ordinary time cash earnings, By occupation, May 2010


In addition to data on earnings, the EEH survey collects information on hours worked. This enables the calculation of hourly measures of earnings, which are more informative for making gender comparisons. Hourly earnings measures are not influenced by differences in the weekly hours worked by males and females. The EEH survey provides estimates of earnings and hours worked for a sample of employees. This makes it possible to examine the distribution of hourly earnings as well as estimate the median, which is a useful measure of 'typical' hourly earnings. The median non-managerial adult hourly ordinary time cash earnings in May 2010 was $25.50. Median hourly earnings for females was 93% of the male figure ($24.70 compared to $26.70, respectively). From May 2008 to May 2010, female median hourly earnings increased by 7.0%, whereas male median hourly earnings increased by 4.6% over the same period.

The Survey of Employee Earnings, Benefits and Trade Union Membership also provides data on average weekly earnings, and as it is a household survey, a range of socio-demographic characteristics are also available.

In August 2010, average weekly earnings of full-time workers were more than double that of part-time workers across all age groups. Full-time workers earned, on average, $1,267 per week in all jobs, compared with $468 for part-time workers. Workers with the lowest average weekly earnings were those aged 15–19 years ($559 for full-time workers and $172 for part-time workers) while those with the highest average weekly earnings were aged 35–44 years ($1,440 for full-time workers and $594 for part-time workers) (graph 8.46).


8.46 Average weekly earnings, By age group, August 2010

 

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Statistics contained in the Year Book are the most recent available at the time of preparation. In many cases, the ABS website and the websites of other organisations provide access to more recent data. Each Year Book table or graph and the bibliography at the end of each chapter provides hyperlinks to the most up to date data release where available.


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