You cannot stop an oil tanker on a dime. It takes up to 4 kilometres before a tanker carrying 2 million barrels of oil comes to standstill.
It believes wages have to be growing at better than 3 per cent annually so that inflation stays within its target band, which would then enable it to start normalising interest rates. Wages across the professional services sector hit 3.4 per cent, its best pace since the Gillard government.There were also strong pulses in the big employing construction sector while even in hospitality – hit hard by lockdowns in NSW, Victoria and the ACT – there were signs of strength.Add in bonuses , the reopening of the economy and the shortage of workers in some sectors and you can persuasively argue the figures show wages starting to turn like our oil tanker analogy.
RBA is stuck in a traditional working model of full time work, the fact is a lot of young staff are not interested in traditional full time work, they want quality of life,work four days a week, work from home flexibly and are happy to trade that for large wage increases.