Australia Raises Minimum Wage by 4.75% for Low-Income Workers

Sydney. Australia's independent wage-setting body has announced that the minimum wage for about 2.8 million low-income workers in the country will be increased by 4.75 percent from July.

Some economists have warned that this decision could create further pressure on inflation. According to the Fair Work Commission, the minimum weekly wage will reach 1,409.90 Australian dollars (approximately 719 US dollars) from July 1.

This means the minimum hourly wage will be 26.44 Australian dollars. This increase is higher than last year's; in 2025, the minimum wage increased by 3.5 percent.

However, trade unions had demanded an increase in wages between 5 percent and 6 percent during the review period. The commission stated that the Reserve Bank of Australia's (RBA) tight monetary policy will slow economic growth in the coming year.

It also mentioned that inflation has risen again due to disruptions in oil supply caused by the US-Iran and West Asia conflict. Although it stated that it is not possible to provide real wage growth in the current uncertain situation, the commission said that the wage has been increased with the aim of at least ensuring that employees' purchasing power does not fall below the July 2025 level.

Analysts at the investment banking company Citigroup have said that the increase in the minimum wage will further increase the costs for businesses, which could push inflation upwards. They estimate that the RBA may increase interest rates for the fourth time in August to 4.6 percent. Financial services provider Westpac has also warned that inflation may remain high for a longer period than expected, stating that the wage increase is larger than expected.