The latest wage figures show no sign of wages growth powering inflation, as the real value of private-sector wages fell in the September quarter.

Other than inflation, the figures the Reserve Bank of Australia most keeps an eye on are the quarterly wages growth figures. These give us a sense of whether there is so much competition for jobs that employers are offering higher wages and workers can demand higher wages without fear of their hours being cut.

The RBA likes to think that the current level of unemployment means the job market is still “tight” (a polite way of saying they would like to see more unemployment). They believe there is too much competition for workers, and so wage growth will be strong and drive up prices.

And yet in the September quarter private-sector wages grew just 0.7%, down from 0.8% in the June quarter and 0.9% in the first three months of this year:

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The annual figures........

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