"The following factors support the view that only a modest wage increase is warranted this year:
- Employment growth is exceedingly weak nationally;
- Inflation has been low over an extended period;
- Rising energy costs and other cost pressures have eroded businesses' capacity to afford wage increases;
- Measurable productivity growth is very weak; and
- National aggregate income remains weak and unevenly distributed.
"Rising youth unemployment and underemployment, and falling participation, suggest significant pockets of spare capacity are building up, particularly at the lower-skilled end of the labour market. In such circumstances, it is important that the Fair Work Commission adopt a cautious approach when determining the level of any minimum wage increase in this year's Annual Wage Review," Mr Willox said.
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