MINIMUM WAGE INCREASE ADDS TO RISING COSTS

Written on the 3 June 2013

MINIMUM WAGE INCREASE ADDS TO RISING COSTS

AN increase to the minimum wage will add about $4000 annually to the cost of employing a Queenslander, says CCIQ’s Nick Behrens (pictured).

The minimum wage will increase 2.6 per cent from July 1 to $622.20 per week ($16.37 per hour), a $15.80 pay rise, the Fair Work Commission (FWC) decided today.

Behrens, general manager advocacy the Chamber of Commerce and Industry Queensland, expects the decision to have an impact on jobs.

“Our view is, in a generally difficult trading environment, the decision will have some impact on jobs and some businesses may mitigate by adjusting the size of their workforces,” he says.

“That is not desirable, but it is a reality in the difficult economic environment many businesses are experiencing.”

It is a smaller increase than the $17.60 awarded last year, or in the two years prior ($19.40 in 2011 and $26 in 2010), but Behrens says it is still difficult for Queensland businesses to absorb when it is compounded by penalty rates and power prices.

“When you couple the wage increase together with the electricity price rises, with the dramatic increase in insurance – all costs of business are rising, but sales are flat and profitability is being eroded.

“Superannuation, workers compensation, penalty rates, they all hinge off the hourly base rate, compounding it dramatically.”

Employment law expert with McKays Solicitors, Scott McSwan says there will be casualties from the pay boost.

“There is always a cost. The only question is who will pay it,” he says.

“There will inevitably be an impact on small business on the Gold Coast. A small business which can’t afford cost increases may just shut up shop.

“Low paid workers will welcome the $15 a week increase but it could be a double edged sword for them. Sadly, some (employers) may look to reducing staff or in particular reducing the hours of casuals.

In making its decision, the FWC took into account relatively strong economic conditions over the past year, especially compared to other members of the Organisation for Economic Co-operation and Development (OECD) countries.

GDP grew by 3.1 per cent in the year to December and the labour market was “soft, but sound” with a slight rise in unemployment rate.
Inflation has been subdued, at about 2.5 per cent on all Consumer Price Index (CPI) measures in the year to March.

“On all measures, labour productivity increased over the year to the December quarter 2012,” says FWC’s published decision.

“Labour productivity, as measured by GDP per hour worked in trend terms, was 2.9 per cent higher; gross value added in the market sector per hour worked increased by 2.4 per cent; and GDP per capita increased by 1.2 per cent.”


Latest News

2017 BRISBANE TOP COMPANIES REVEALED

WHILE Queensland is regarded as an economy in transition with the winding down of the mining boom, the 2017 top 50...

2017 BRISBANE TOP COMPANIES 1-10

FROM insurance and banking to travel, gambling, retail, property and pizza, these "heavyweights" have ha...

2017 BRISBANE TOP COMPANIES 11-20

RETAIL, property, an airline, cars, real estate, software services, energy, agriculture, veterinary services bathr...

2017 BRISBANE TOP COMPANIES 21-30

JEWELLERS Michael Hill International listed in 2016 with a half-billion dollar market capitalisation and a new CEO...

Related News

FURNITURE DISRUPTOR SET TO SHARE HIS ONE OF A KIND BUSINESS MODEL

IT'S no secret that Australians love homemaking. Their ceaseless quest to create the perfect place to call hom...

WEEDING OUT THE ASX'S BURGEONING CANNABIS TREND: 8 COMPANIES TO WATCH

A NICHE is budding on the ASX in the form of medical cannabis, an industry which has been on the country's rad...

FRESH CLASS ACTION TO REVEAL ANOTHER SIDE OF SLATER AND GORDON DOWNFALL

ACA LAWYERS has issued a formal letter of demand to Andrew Grech (pictured), managing director of Slater and Gordo...

STARSHIPS WERE MEANT TO DELIVER DOMINO'S PIZZA

NICKI Minaj may have been off the mark when she declared 'starships were meant to fly'. However, she m...

BOOK YOUR FUNCTION SPACE HERE

 

 

 

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter