RBA board member rejects risk of an Australian wage-price spiral
Australia's unemployment rate was 4.5 per cent.
Iain Ross, a member of the Reserve Bank of Australia's monetary policy board, said there was no evidence of a current wage-price spiral and that recent data made one unlikely. He attributed the difference from the 1970s to changes in Australia's labour-market and wage-setting institutions.
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AllegedIain Ross said there was no evidence of a wage-price spiral in Australia and that recent data suggested one was unlikely.
“There is no evidence of the emergence of a wage-price spiral in the present circumstances and recent data suggest such an outcome is unlikely”
AllegedIain Ross said Australia's current wage-setting mechanisms made a repeat of 1970s wage-price dynamics less likely.
“These changes in Australia's wage-setting mechanisms have made the wage-price dynamics of the 1970s much less likely to recur”
Employees covered by enterprise agreements cannot pursue wage-increase claims until the agreement's nominal expiry date has passed.
“Such employees are unable to pursue claims for increased wages until the enterprise agreement to which they are subject has passed its nominal expiry date”