Australia's Minimum Wage Increased By $21.60 A Week

More than two million of Australia's lowest paid workers will receive an extra $21.60 in their pocket each week from July 1, the Fair Work Commission has announced.

The national minimum wage has been increased by three percent, lifting the weekly wage from $719.20 to $743.50.

President of Fair Work Australia, Justice Iain Ross, cited a fall in GDP and a drop in inflation and is confident the hike is enough to give the nation's lowest paid workers a leg up.

"We are satisfied that the level of increase we have decided upon will not lead to any adverse inflationary outcome and nor will it have any measurable negative impact on employment," he said.

The Morrison Government has welcomed the decision, so too has the Australian Council of Trade Union, but assistant secretary Liam O'Brien said it doesn't go far enough. 

"Many workers who receive the minimum wage will remain in poverty which is unacceptable in a country like Australia," he said. "Australian workers should be able to work full-time hours and live free from poverty"

The increase is half a percent less than last year. Photo: REUTERS/David Gray

The ACTU called for a six percent increase, which would have helped the lowest paid workers get to within 60 percent of median wages within two years.

This year's increase fell short of not only that target but last years wage increase as well.

"Inflation has played into that and it is lower so in real terms we are still seeing a significant increase," he said.

"We did call for more but we believe that minimum wage in this country should be higher.

"Every cent [workers] get helps them meet the bills that are necessary to sustain life whether it rent, whether it be electricity, this is important for working people," he said.

Kim is on minimum wage and says it's helpful but not enough

Kim, who works at a call centre, said it's not enough to cover the increasing cost of living.

"I don't think it will even be enough to just cover rent increases," he said. "It's quite clear that we're not just going to get money handed to us and we need to get people not just increasing the minimum wage but getting people off the minimum wage by getting bargaining agreements."

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Lorraine is a school cleaner, she agreed that while the increase is good news, workers will still struggle to make ends meet.

"People out there are struggling with the price of meat, the price of housing, the price of food, rent, petrol," she said.

It's a blow for business groups which had called for a more modest 2 percent hike, or $14.40 a week.

The Australian Chamber of Commerce and Industry warns today's announcement could put jobs in danger and risk the viability of some small businesses.

"It is not just the less than 2% of employees who are on the minimum wage who will receive a wage rise," CEO James Pearson said. "It will cost Australian employers an additional $3.1 billion per year."

“Employers respect the independent decisions of the Fair Work Commission, but a third straight increase well in excess of inflation will be difficult for businesses, particularly small businesses, to absorb."