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6345.0 - Labour Price Index, Australia, Sep 2005  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 16/11/2005   
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PRICE INDEXES AND CONTRACT PRICE INDEXATION

SEPTEMBER KEY FIGURES

Jun Qtr 2005 to Sep Qtr 2005
Sep Qtr 2004 to Sep Qtr 2005
% change
% change

Wage Price Index (WPI)
Total hourly rates of pay excluding bonuses
Seasonally Adjusted
Australia
1.0
4.2
Sector
Private
1.0
4.0
Public
1.2
4.7
Original
Australia
1.4
4.2
Sector
Private
1.2
3.9
Public
1.6
4.7

2003-04
2004-05
% change
% change

Labour price index excluding bonuses
Australia
3.5
3.8
Sector
Private
3.2
3.6
Public
4.4
4.4

WPI-Quarterly changes, Total hourly rates of pay excluding bonuses
Graph: WPI–Quarterly changes, Total hourly rates of pay excluding bonuses

WPI-Annual change: original, Total hourly rates of pay excluding bonuses - For selected industries
Graph: WPI–Annual change: original, Total hourly rates of pay excluding bonuses—For selected industries



SEPTEMBER KEY POINTS


TOTAL HOURLY RATES OF PAY EXCLUDING BONUSES

QUARTERLY CHANGES (JUN QTR 2005 TO SEP QTR 2005)

  • The index for all employee jobs in Australia increased by 1.0%, seasonally adjusted.

ANNUAL CHANGES (SEP QTR 2004 TO SEP QTR 2005)
  • The seasonally adjusted increase through the year to September 2005 for all employee jobs in Australia was 4.2% (in trend terms, also 4.2%).


LABOUR PRICE INDEX EXCLUDING BONUSES

CHANGE FROM 2003-04 TO 2004-05
  • The change in 2004-05 was 3.8%, with the private sector increasing by 3.6% and the public sector by 4.4%.


NOTES

ABS DATA AVAILABLE ON REQUEST

Original indexes are compiled for various combinations of state/territory, sector (private/public), broad industry group and broad occupation group. Seasonally adjusted and trend indexes are only compiled for total hourly rates of pay excluding bonuses for the private sector, public sector and all sectors. Indexes not included in this publication may be made available on request by telephoning Perth (08) 9360 5151.



FURTHER INFORMATION

More detailed information on the Labour Price Index (LPI) is available in Information Paper: Labour Price Index, Australia 2004 (cat. no. 6363.0) and Labour Price Index, Concepts, Sources and Methods, Australia (cat. no. 6351.0.55.001).



INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or David Taylor on Perth (08) 9360 5151.



COMMENTARY


WAGE PRICE INDEXES

Safety Net Review (SNR)

The Australian Industrial Relations Commission handed down its 2005 SNR decision on 7 June 2005 to increase federal full-time minimum award rates by $17 a week. All state jurisdictions handed down the same increase with varying date of effect, increases are likely to flow through mainly in the September and December indexes.


The $17 increase equates to a 3.6% wage increase for those jobs paid minimum award rates i.e. an increase to $484.40 per 38 hour week. In comparison, the May 2004 SNR increase was $19.00 a week, equivalent to a 4.2% increase.


Most of the impact of the SNR on the wage price index traditionally occurs in the September and December quarters.


Sector

The seasonally adjusted through the year movement for the private sector was 4.0%, with the public sector recording an increase of 4.7%.


Industry

In original terms, the industries with the highest rate of increase through the year to September quarter 2005 were Mining, Government administration and defence, Health and community services, and Cultural and recreational services which all recorded 5.0%. The Construction industry also had strong wages growth over the period with an increase of 4.7%. The lowest rate of increase was 3.2% which was reported by both Accommodation, cafes and restaurants, and Communications services.



NON-WAGE PRICE INDEXES

Annual and public holiday leave

In most states and territories there were minimal changes in annual leave and public holidays. The main exceptions were Victoria and Tasmania. In 2003-04, ANZAC Day fell on a Sunday and in 2004-05 it fell on a Monday. Unlike other jurisdictions, Victoria and Tasmania did not provide an additional day off in lieu in 2003-04. This was a major factor in these states having an increase of 7.7% for annual and public holiday leave for 2004-05.


Superannuation

The percentage change from the previous financial year increased from 3.7% in 2003-04 to 4.0% in 2004-05. The increase was driven by rises in wages, as the rate of superannuation changed for only a very small number of jobs.


Payroll tax

South Australia, Western Australia and the Northern Territory changed their payroll tax rates and/or payroll tax thresholds in 2004-05. South Australia reduced the rate of payroll tax from 5.67% to 5.5% in 2004-05, Western Australia reduced the rate of payroll tax from 6.0% to 5.5% effective from January 2005 onwards. The Northern Territory increased its payroll tax threshold from $600,00 to $800,000 in 2004-05 having cut the payroll tax rate the previous year.


The percentage change for the payroll tax index for South Australia for 2004-05 was 0.7%, compared to 4.4% for 2003-04. The equivalent figures for WA are 0.7% for 2004-05 and 3.8% for 2003-04. The Northern Territory recorded an increase of 0.8% for 2004-05 compared with 2.2% for the previous year.


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