Minimum awards and wage increases a critical decision for Indigenous workers' economic security
Centre for Indigenous People and Work (CIPW)
Centre for Indigenous People and Work (CIPW)
UTS Business School | Jumbunna Institute
FOR IMMEDIATE RELEASE
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Annual Wage Review 2026: A critical decision for Indigenous workers’ economic security
The Centre for Indigenous People and Work (CIPW) has welcomed the Fair Work Commission’s Annual Wage Review 2026 decision to increase minimum awards rates by 4.75%, and the minimum wage by 5.97%, emphasising its critical importance for Aboriginal and Torres Strait Islander workers across Australia.
CIPW highlights that the Commission’s decision is not a marginal adjustment for Indigenous workers, it is a central determinant of living standards, economic security and long‑term financial outcomes.
A decision that matters disproportionately
Aboriginal and Torres Strait Islander employees are disproportionately reliant on minimum wage and modern award outcomes determined by the Fair Work Commission. This reflects their concentration in low‑wage, award‑reliant industries such as retail, hospitality, and community and care sectors.
As a result, wage increases determined through the Annual Wage Review are often one of the main mechanisms through which Indigenous workers experience real wage growth.
“For many Aboriginal and Torres Strait Islander workers, this decision shapes whether wages keep pace with the rising cost of living,” Professor Nareen Young, Director of CIPW said.
“It directly affects the capacity of workers and their families to meet everyday expenses, from housing and food to transport and utilities.”
This reliance is particularly significant for Indigenous women, who are over‑represented in low‑paid, feminised occupations and experience some of the largest pay disparities in the Australian labour market.
Jobs and Skills Australia research found Indigenous women earn on average around 35 per cent less than Australian men overall. Indigenous women face a 10-percentage point higher gap compared to female workers overall. When measured cumulatively, the disadvantage deepens: over a ten‑year period, Indigenous women earn more than 38 per cent less than men, entrenching long‑term economic insecurity.
Wage-setting as a lever for economic inclusion
CIPW emphasises that the Annual Wage Review is a key equity lever within Australia’s industrial relations system.
Because Aboriginal and Torres Strait Islander workers are more likely to be award‑reliant, the Commission’s wage‑setting decisions have a disproportionately large impact on Indigenous economic inclusion, workforce participation, and income equality.
“This is one of the most important policy tools available to support fair pay outcomes for Indigenous workers,” Professor Young said. “It plays a direct role in addressing entrenched structural inequalities in the labour market.”
Addressing lifetime economic security
CIPW stresses that the significance of the Annual Wage Review extends well beyond immediate weekly pay.
A lifetime of low wages not only constrains workers’ capacity to meet day‑to‑day living costs; it also materially reduces opportunities for home ownership, capital accumulation, and long‑term financial security.
Lower lifetime earnings translate into reduced superannuation balances, diminished capacity to absorb financial shocks, and fewer opportunities to build assets over time.
For Aboriginal and Torres Strait Islander workers, who are more likely to spend extended periods in low‑paid roles, these cumulative effects are particularly severe. Over time, they contribute to persistent economic disadvantage and limit intergenerational wealth building.
“The Commission’s decision affects not just current wages, but long‑term financial trajectories,” CIPW said. “It influences retirement outcomes, wealth accumulation and economic resilience over generations.”
Call for continued focus on equity
CIPW calls on policymakers, employers and the broader community to recognise the central role of fair minimum and award wages in strengthening economic growth so it is inclusive of Indigenous workers.
“Ensuring adequate and sustained real wage increases is essential to improving living standards and addressing structural inequality,” Professor Young said.
“Fair wage‑setting is fundamental to building an economy in which Aboriginal and Torres Strait Islander people can thrive, not just today, but across their working lives and into retirement.”
Contact details:
Raj Wakeling on 0420 414 724 or [email protected]