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Why Are Australian Wages Lagging and What Can Be Done About It?

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  • Joe Isaac

Abstract

Wages in Australia have lagged behind the growth in labour productivity in recent years. This has been associated with a significant change in the distribution of income in favour of high†income earners. Although a number of factors appear to have been involved in this development, an important explanation is also to be found in the change in the balance of power in favour of employers and against workers and unions. As changes in industrial relations laws have contributed substantially to this imbalance, a return to the earlier laws may be necessary to restore the institutional mechanism for wages growth.

Suggested Citation

  • Joe Isaac, 2018. "Why Are Australian Wages Lagging and What Can Be Done About It?," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 51(2), pages 175-190, June.
    • Handle: RePEc:bla:ausecr:v:51:y:2018:i:2:p:175-190
    DOI: 10.1111/1467-8462.12270
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    References listed on IDEAS

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    1. Alexandra Rush & David Jacobs, 2015. "Why is Wage Growth So Low?," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 09-18, June.
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    3. Isaac, J, 2012. "Keynes versus the Classics in the 1970s," Australian Bulletin of Labour, National Institute of Labour Studies, vol. 38(2), pages 96-110.
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    5. Bruce E. Kaufman, 2018. "How Capitalism Endogenously Creates Rising Income Inequality and Economic Crisis: The Macro Political Economy Model of Early Industrial Relations," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 57(1), pages 131-173, January.
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    Cited by:

    1. Stephen Bell & Michael Keating, 2019. "Low Wage Growth: Why It Matters and How to Fix It," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 52(4), pages 377-392, December.
    2. James Bishop & Iris Chan, 2019. "Is Declining Union Membership Contributing to Low Wages Growth?," RBA Annual Conference Papers acp2019-06, Reserve Bank of Australia.

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