The Australian Retail Association has warned that lifting the minimum wage for retail workers will lead to job losses and higher consumer prices across the board.
Unions are calling for a 7 per cent inflation-linked minimum wage rise from July 1.
Australian Retailers Association CEO Paul Zahra has warned this will lead to job cuts across the retail sector.
“Most of retail is in negative growth,” Zahra told the AFR.
“All you’ve got growing currently is food retailing, and that’s because of inflation.”
Australian retail sales volumes fell 0.6 per cent in the first three months of 2023, following a 0.3 per cent fall in the December quarter.
Retail sales volumes for household goods fell 3.7 per cent, the fifth consecutive fall, while other retail sales fell 0.8 per cent.
Zahra said the customer will end up paying for the increase in wages through higher prices.
“In a cafe with an owner-operator and a handful of staff on thin margins, at the end of the day, any wage increase is passed on – it goes straight through to the customer,” he said.
Wage figures to be released this week are expected to show a 0.9 per cent salary rise for the March quarter, with the annual growth rate expected to be a 3.6 per cent.
This will mark a decade-high increase, but one that represents a loss when compared to inflation.
Business groups are pushing for a smaller lift in the minimum wage, around the 3.5 per cent to 4 per cent mark.
Australian Chamber of Commerce and Industry is calling for a 3.5 per cent increase.
“The Commission must reject the simplistic calls by the ACTU for inflation-matching wage increases,” ACCI chief executive Andrew McKellar said.
“Instead, a carefully calibrated approach is necessary which balances the pressures faced by business and households alike.”
