Mixed feelings about the minimum wage rise

Sometimes a wage rise will make people forgive a lot of things and feel more content that their jobs give them the financial freedom to buy things like pizza and towels. 

So, after a long delay in wage growth, the Fair Work Commission’s wage panel on Wednesday decided to raise the minimum wage by 2.5 per cent for 2.2 million workers from $19.84 to $20.33 an hour, or $771.60 a week. 

The decision was made considering the “markedly better economic environment”. However the wage rise isn’t effective for aviation, tourism, hospitality, gyms, events and hairdressers until November 1, to guard against risks of future lockdowns. 

“The broad consensus is the current performance of the economy has exceeded expectations and the economic recovery is well under way,” Fair Work president Justice Iain Ross said.

He said businesses have had their fair share of no increase in minimum wages between July 1 2020 and February 1 2021. 

While the decision speaks strongly amongst millions of workers, businesses and industry groups are going nuclear upon hearing the news. 

A bitter pill to swallow

Employers in the hardest hit sectors, who have been routinely forced to stop trading or reduce customer density, are looking about as inspired as a steamed dim sim sitting in a switched-off bain-marie. 

Major employer groups argued that small businesses were already struggling to recover from the exasperating, tiresome and brutal 33 days of state-imposed lockdowns. The minimum wage rise coupled with a 0.5 per cent increase in superannuation next month are too much for small businesses to handle. 

Australian Industry Group chief executive Innes Willox has warned that this increase will slow down jobs growth and could threaten the economic recovery. 

“At the current stage of the recovery, the focus needs to be on boosting employment. The decision will create a real risk that jobs growth and inroads into unemployment and underemployment will slow considerably.” he said. 

Australian Chamber of Commerce and Industry chief executive Jenny Lambert also slammed the decision, saying it could amount to a $3.6 billion burden on business. 

Australian Retailers Association head and former David Jones CEO Paul Zahra said: “The timing of the increase remains a significant concern...Whilst there has been overall retail growth, challenges remain for many small businesses.” 

Go for it

Industrial Relations Minister Michaelia Cash expresses a favourable opinion of the decision, saying it represents “a real wage increase” for millions of workers.

“It reflects the strong economic management of the Morrison government, putting the right conditions in place to drive upward pressure on wage