The Australian Retailers Association (ARA) claims the National Minimum Wage increase of 3.5% will stifle jobs growth within the retail sector.
The Fair Work Commission recently announced the National Minimum Wage will increase to $719.20 per week, or $18.93 per hour from 1 July 2018.
The General Retail Industry Award (GRIA) will increase to $789.90 per week or $20.79 per hour for full-time and part-time employees and $25.98 per hour for casuals.
ARA executive director Russell Zimmerman said Australian retailers are already facing an unsteady trading environment and this increase will be detrimental to the growth and stability of the Australian retail industry.
“Monthly retail sales growth is currently around 2% however we would like to see this growth increase to 4% to ensure retailers can invest in their business and employ more staff,” Zimmerman said.
“With retailers already struggling to keep their heads above water, today’s 3.5% minimum wage increase will stifle retail growth and delay staff employment across the sector.”
The ARA sought a minimum wage increase of 1.9% to increase staff employment by 3.5% over the next 12 months.
Given the current state of the sector and recent store closures, Zimmerman said the increase would certainly have a negative effect on retailers and could potentially result in job losses.
“The ARA are passionate about maintaining a sustainable wage growth and would like to see retailers given the chance to not only invest in their business, but invest in employment to promote retail as a vibrant career choice for all Australians,” Zimmerman said.
“Today’s minimum wage increase is well above inflation, putting the brakes on employment and innovation throughout the industry, which is detrimental for the retail sector.”