Falling wages good for employment - Reserve Bank governor | Pacific Beat

Falling wages good for employment - Reserve Bank governor

Falling wages good for employment - Reserve Bank governor

Updated 20 August 2014, 16:13 AEST

The governor of Australia's Reserve Bank has played down concerns about falling wages in Australia.

Glenn Stevens has told a House of Representatives economics committee hearing that sluggish income growth is simply a reflection of the high unemployment rate.

Wages are currently growing well below the pace of inflation, leaving most Australians with an effective pay cut over the past nine months.

But Glenn Stevens says lower wages mean businesses can hire more staff, so it's one of the few things stopping the jobless rate rising above its current 12-year-high.

Presenter: Pat McGrath

Speaker: Glenn Stevens, governor, Reserve Bank

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