The latest research from the Centre for Labour, Employment and Work (CLEW) at Victoria University shows - once again - that it pays to belong to a union. 

CLEW’s annual analysis of collective employment agreements (CEAs) shows that wages in collectives rose by 2.8 per cent in the year to June 2019, significantly higher than the 2.3 per cent last year.  

Over the same period, the labour cost index (LCI) rose by 2.1 per cent, up from 1.9 per cent in the previous year. LCI measures changes in base salary, ordinary time wages, overtime wages and non-wage labour related costs, and is dominated by people on individual rather than collective employment agreements. 

This CEA and LCI comparison suggests that people who are part of a collective get better pay rises – the union pay premium. 

Helped by the rise in the minimum wage, private sector collective pay rates rose 3.5 per cent, the highest increase since 2010 and well up from last year (2.9 per cent). By contrast, the private sector LCI rose only 2.2 per cent, a slight change from last year's 2.1 per cent, although still the highest since 2009. 

Central government CEA wage rates rose 2.3 per cent, the highest since 2011, and the same rate as the increase in the central government LCI.  

Local government CEA pay rates rose 4.3 per cent (up from 2.8 per cent in 2018), significantly more than the local government LCI which rose 1.8 per cent. 

Read more HERE.