Australia’s Minimum Wage Has Been Increased with Workers Set to Pocket an Extra $40 Per Week

It's a good day for the bank balance!

It's no secret a lot of us have been doing it tough financially lately. Between COVID and the rising cost of living, our wallets have been taking a hit. 

But, in welcome news this morning, more than two million workers will take home an extra $40 per week after the Fair Work Commission announced Australia's national minimum wage is getting a boost. 

On 1 July, the base rate will jump $1.05 per hour to $21.38—an increase of 5.2 per cent which is more than the government's suggested 5.1 per cent increase and sits slightly above inflation. Not too shabby?

The decision is set to affect more than 2.7 million workers, as well other others on award rates and enterprise agreements.

According to the ABC, those employees in the aviation, hospitality and some tourism industries will face a small pay cut in real wages, but will see their award rates go up 4.6 per cent from 1 October.

Fair Work Commission President, Iain Ross, said they were "conscious that the low paid are particularly vulnerable in the context of rising inflation".

"If we were to accept the submissions of some of the employer bodies, and award no increase at all, then the real wage reduction would be even more severe," he said.

Mr Ross also added that the increase would not have a "significant adverse effect" on the economy.

But the cost of living is burdening almost everyone at the moment, with the Reserve Bank expecting inflation will continue to rise to reach 7 per cent by Christmas and the federal government's temporary 22 per cent cut to the fuel excise set to end in September. 

So, is this enough to help the average student get by week-to-week?

The Unions have said it's a good start, but it isn't there yet. 

Head of the Australian Council of Trade Unions, Sally McManus, said the announcement was "reasonable" and "fair", but that there were many other workers still waiting to see an increase to their pay packets.

"All Australians should share in the recovery and share in the growth that they are producing at the moment, and they are not," she said.

Whether you think the rise is too much or not quite enough, it is positive news for those people needing that little bit of financial help.

For everything you need to know about money and budgeting, check out all our articles here. 

Header Image: Unsplash.