Key takeaways
- Wages rose 0.8 per cent over the quarter.
- Annual wages growth steady at 3.1 per cent.
- Around 21,000 jobs added in January.
Australia's labour market remains tight and on a solid footing, but is not materially strengthening at this stage, according to the latest monthly CBA Wage and Labour Insights.
The report draws on de-identified salary flows from around 400,000 CBA accounts to provide an early snapshot of wages and employment trends, offering a timely view of shifting conditions at potential policy turning points ahead of official ABS data.
Wage momentum remains solid across the start of the year
Australia's wages growth held steady in January, with CBA data showing quarterly wage growth at 0.8 per cent and annual growth at 3.1 per cent. Overall, wages have been tracking broadly sideways, though there has been a gradual lift in quarterly outcomes since mid-2025
Western Australia continued to report the strongest wage gains, while outcomes across the eastern states remained steady.
"While wage growth is firm but not excessive, weak productivity growth means businesses continue to face elevated labour cost pressures," Ottley said. "This underpins our assessment that labour market conditions remain tight and are still contributing to inflation."
Jobs growth softens but the labour market remains tight
CBA's Labour Insights indicate the economy added an estimated 21,000 jobs in January. Employment growth remains solid but is gradually moderating.
"The December official labour force survey was very strong and showed unemployment falling sharply, but that survey can be volatile. Our internal indicators do not suggest a material re-tightening in the labour market at this stage," added Ottley.
Ottley said official and internal data would be closely watched in coming months. "Taken together, the January data point to a labour market that is still tight and on a solid footing, but not one that is materially strengthening."
One more rate rise expected
CBA economists continue to expect one further interest rate increase in May, which would take the cash rate to 4.10 per cent. Monetary policy adjustments from here are likely to involve fine‑tuning rather than a renewed tightening cycle.
Read the full report: CBA Economic Insights: Wage and Labour Insights - January 2026
