Country Report Australia October 1996 Main report

Employment, wages & prices: Telstra to shed 1/3 of workforce--

The state telecommunications firm, Telstra, is planning to shed 24,000 jobs from its total workforce of 76,000 by mid-1999. A reduction of around 9,000 is planned for 1996/97. The labour shedding will involve both redundancies and a large outsourcing programme. The prospect of large job losses has led to conflict with Telstra's two main unions, which claim that management is caving in to calls from government to cut costs in the lead- up to privatisation. Both the independent senators have also expressed concern over job losses, particularly in rural areas.

--and wages growth remains of concern

The growth in average weekly ordinary time earnings amounted to 1.3% for the three months ending in May, compared with 0.4% for the previous three- month period. Despite this rise, wages growth over the 12 months ending in May fell to 3.9%, from 4.2% over the 12 months ending in February. This suggests that slower economic growth has had an impact on wages, but the concern is that slower wages growth will not be sustained. The annual wage rises agreed in recent enterprise bargains have increased from just over 5% for those concluded in the first quarter to just over 6% for those concluded in the second quarter. More recently, enterprise deals appear moderated somewhat, but it is unclear whether this is a sustainable trend.

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