JIM CHALMERS MP
SHADOW TREASURER
MEMBER FOR RANKIN
E&OE TRANSCRIPT
PRESS CONFERENCE
SYDNEY
WEDNESDAY, 23 FEBRUARY 2022
SUBJECTS: The cost of living is skyrocketing, real wages are going backwards, and working families are falling further behind; Labor condemns the actions of Russia; Importance of Australia speaking with one voice on sanctions; Labor’s policies to get the economy growing the right way; Technology and the labour market.
JIM CHALMERS, SHADOW TREASURER: Today we've got new wages data from the Bureau of Stats, which shows that real wages are still going backwards in this country even as the economy recovers and the unemployment rate falls. We've got annual wages growth of 2.3% at the same time as we've got inflation running at 3.5%, so real wages are going backwards still by something like 1.2%.
Under this Government, the cost of living is skyrocketing, real wages are going backwards, and working families are falling further behind. This is the Prime Minister and the Government for higher prices and lower wages, and Australians finding it that much harder to make ends meet.
Wages growth has been at or near record lows for much of the decade that this Government has been in office. That's because, as the former Finance Minister has said, stagnant wages are a ‘deliberate design feature’ of the Government's economic policy. We see that with their attacks on penalty rates, and the way that they've undermined job security for much of the last decade. The Coalition wants wages growth to be low and as a consequence of that we've got the costs of living skyrocketing, real wages falling, and working families falling further behind.
The big risk at this election is another three years like the last ten - another three years of stagnant wages, and attacks on job security, and the undermining of living standards right throughout Australia.
We understand in the Labor Party that it's not a real recovery in the economy if ordinary working people are being left behind. It's not a good enough recovery if people who are working hard just can't get ahead and provide for their loved ones.
What these numbers show today is that even in a recovering economy real wages are still falling. Australians are having to bear the brunt of skyrocketing petrol prices, skyrocketing rent, the cost of groceries going up, at the same time as their capacity to provide for their loved ones is falling, and we saw that again in the data today.
What this tells us, once again, is that the labour market is more than the unemployment rate. The labour market is what happens to job security, and it's what happens to wages.
Once again, after almost a decade in office, this Government has delivered falling real wages at a time when Australians desperately need to get ahead to provide for their loved ones. Falling real wages can't be the thanks that Australians get for the sacrifices that they've made for each other throughout this pandemic.
As the Australian economy emerges from the worst parts of the pandemic the last couple of years, there's obviously a lot of uncertainty around. The situation in Ukraine could have consequences for our economy, particularly when it comes to energy prices, when it comes to food security - particularly in Europe, investor confidence, and all of these issues around inflation, which is so important to working families here in Australia.
Labor condemns, in the strongest possible terms, the actions of Russia. We support strongly the sovereignty and the territorial integrity of Ukraine. We have been as supportive as we possibly could be of the Government's efforts when it comes to responding to this act of Russian aggression.
We support the targeted sanctions announced by the Government today, we support those being imposed in concert with like-minded nations who are responding similarly to us. We support the consideration of any further actions that might be necessary - whether they be diplomatic, or technical, or in the cyber world, or even further sanctions.
We expect to be briefed on developments as they play out. We would like to see an element of bipartisanship here, we are happy to provide bipartisanship to the Government when it comes to these important sanctions and any further steps that might be considered. We would expect to be briefed on those developments as they occur, so that Australia can speak to the world with one voice when it comes to condemning this act of Russian aggression.
We stand with people of Ukrainian origin here in Australia and around the world going through a very, very difficult time. As I said, if there are other steps that need to be considered, then we want to be part of that conversation as well. Over to you.
JOURNALIST: Shadow Treasurer, you say that federal Labor supports the Government's sanctions on Russia. Are you concerned though that Australians might experience retaliation as a result of these sanctions?
CHALMERS: We would expect to be briefed on any expectations of that nature. Our view is that the world needs to speak with one voice when it comes to condemning this act of Russian aggression, and if there are consequences for that then we'll see them play out. But the most important thing is the world does what it can to impose these sanctions in concert with like-minded countries, so that there are costs and consequences for a Russian regime which is prepared to violate the sovereignty and territorial integrity of Ukraine.
JOURNALIST: Base pay rose over the year to December and annual growth was the fastest since the pandemic hit, is this promising?
CHALMERS: No, we're still seeing wages growth which is well below inflation. That's how we get real wages which are falling. Never forget that even in the Government's own Budget - and they're notorious for overpromising and under-delivering on wages - even in the Government's own Budget, they've got real wages going backwards this year. So what really matters here is whether working families can keep up with the skyrocketing costs of living, whether they can provide for their loved ones and get ahead, and what today's numbers show once again is that costs are going through the roof, real wages are going backwards, and working families are bearing the brunt of those failures.
JOURNALIST: So what is Labor's plan to raise the minimum wage?
CHALMERS: We've got a suite of policies about getting wages growing again. Obviously, in aggregate, you need to grow the economy the right way. We've got a series of policies around growth - whether it be in skills, cleaner and cheaper energy, our childcare policy, modernising the NBN, co-investing in advanced manufacturing and the care economy. There's that at the aggregate level. It matters a great deal to getting the right kind of growth and the right kind of labour market. But we also need to deal with job insecurity. One of the reasons why we've had a decade or so of stagnant wages growth is because this Government's deliberately undermined job security. We've got a plan which goes to Fair Work Australia, and things like labour hire and the gig economy, to try and restore an element of job security, because the absence of job security is what has played such a big part in undermining wages growth in this country.
JOURNALIST: Just a question from my colleagues in Canberra. Wage growth was strongest in some of the sectors that were hit hardest by the pandemic. Will that provide any relief to these workers?
CHALMERS: Obviously, we want to see wages growing strongly. We want to see wages growing stronger than they are in this data. Clearly, a lot of the essential workers that we have relied on throughout this pandemic have been getting very bad wages outcomes for much of the last decade. What we've seen today in the wages data is a modest improvement in wages growth, which goes nowhere near making up for the cost of living pressures that essential workers and other workers are experiencing.
JOURNALIST: The Reserve Bank wants to see annual wages grow about 3%. How far off that are we?
CHALMERS: Wages growth at the moment is 2.3% annual, inflation is 3.5%, and so you can see the shortfall there in real wages. That's the calculation that matters, whether or not people can actually keep up with the cost of living. The Reserve Bank, I think, has made some welcome contributions to the debate about wages growth. They understand, as Labor does, even if the Government does not, that stagnant wages growth is one of the defining failures of the last decade or so of economic mismanagement. That's why, even in a recovering economy, working families are falling behind, and that's not good enough.
JOURNALIST: Do you think today's figures - which have been released - will prompt the RBA to lift rates?
CHALMERS: Clearly the Reserve Bank looks at a range of economic data. The Governor has said publicly we are seeing inflation in the economy and they want to understand more fully how much of that is enduring and how much of it is related to the supply shocks that we're seeing in the economy. Clearly, the uncertainty in Ukraine is going to add to some of the inflationary pressures, particularly around energy. The Reserve Bank has said pretty clearly they want to see wages growing again, as does the Labor Party - we want to see them growing strongly and sustainably - the absence of that strong and sustainable wages growth has been a big factor in working families in Australia falling behind. The Reserve Bank will factor that in, just as they'll factor in the unemployment rate and some of the other economic indicators. It's not for us to second guess the Reserve Bank. I have been supportive of some of the commentary they've made around wages. I think the absence of wages growth has been the defining feature of the economy for the last decade or so.
JOURNALIST: How will automation impact the Australian jobs market over the next few years?
CHALMERS: We can be optimistic about technology, so long as we are training people to adapt and adopt that technology. Some of the productivity gains that we desperately need to see in the economy are based on our capacity to adapt and adopt to new technology. Whether it's that technology, machine learning, artificial intelligence, some of the developments in financial services and cryptocurrency, and all the rest of it. Our capacity to train people to take maximum advantage of those developments will go to whether technological advancements are a positive for our economy or a negative. I think they can be a big, big positive for our economy, but only if we take the time to train Australians for those developments so that they can be the beneficiaries rather than the victims of technological change. Thanks very much.
ENDS
