Australia’s Wage Growth Stabilizes in Q3 2025

With a seasonally adjusted quarterly increase of 0.8% and an annual 3.4%, both of which satisfy market projections, Australia's Wage Price Index (WPI) for the September quarter of 2025 showed sustained growth. While the public sector saw a larger 0.9% rise, the private sector reported a modest quarterly wage growth of 0.7%. This reflects ongoing stability in quarterly salary trends, matching the performance from the prior quarter.

Annual wage increase remained at 3.4% year-over-year compared to the June quarter, but it fell sharply from the 4.1% registered last year. While private sector wages remained stable at 3.4%, public sector salaries increased at an annual rate of 3.8%, somewhat better than 3.7% in the previous quarter. With a 1.5% rise in initial terms during the quarter, healthcare and social aid grew to be a major industrial driver.

The Reserve Bank of Australia's prudent monetary policy is matched by the stabilization of wage growth, hence supporting estimates that wage growth will progressively fall to 3.0% by mid-2026 and more to 2.9% by the end of 2027. Lower than 2024's 3.75% raise, this moderation mirrors the Fair Work Commission's little yearly wage rise of 3.5% effective July 2025, therefore guaranteeing wage growth stays slightly higher than the historical average of 2.4%.