Australian dividend payments to shareholders from corporate investments grew six times faster than worker pay between 2020 and 2023, new Oxfam analysis reveals on International Workers' Day (May 1).
Accounting for inflation and through COVID-19, the war in Ukraine and the cost-of-living crisis, dividend payments in Australia rose 37%, while average real wages in Australia have fallen by 6%. This is as Australia's biggest banks, miners and retailers record sky-high profits off the back of higher prices, supply chain disruptions and the alleged use of price gouging and unfair pricing practices.
Globally, dividend payments to shareholders grew 14 times faster than worker pay in 31 countries, which together account for 81% of global GDP.
Global corporate dividends are on course to beat an all-time high of USD $1.66 trillion reached last year, according to the Janus Henderson Global Dividend Index, which covers the world's largest 1,200 corporations, representing 90% of global dividends paid. Data for both dividends and wages for 2020-2023 are available for 31 countries, and Oxfam's research shows:
- After adjusting for inflation, global dividend payouts climbed by 45% (USD $195 billion) in 31 countries between 2020 and 2023, while wages grew by just 3 percent.
- Excluding China, which accounts for most of this wage growth, global real wages in these countries fell by 3% during this period.
"The trend of rising dividends payouts has worrying effects on inequality. Corporate profits and payouts to rich shareholders have gone into the stratosphere, while wages continue to go nowhere, said Oxfam Australia Chief Executive Officer Lyn Morgain.
"Millions of people hold jobs that trap them in a cycle of working hard while still being unable to afford enough food, medicine or other basics. The super-rich don't amass their mega-fortunes by 'working'-they extract it from people who do," said Ms Morgain.
Oxfam's analysis of Global Living Wage Coalition (GLWC) data from countries across Africa, Asia and Latin America, found that:
- Only 2 out of 37 countries have a minimum wage above the living wage-a pay rate the GLWC estimates allows workers to meet basic needs, such as housing, food, healthcare, clothing and transportation. Minimum wages on average provide just 38% of the wage needed for living.
- Bangladesh's minimum wage provides a mere 6% of a living wage, and in Ghana it provides just 12%.
These findings reinforce warnings by the International Labour Organisation (ILO) of rising numbers of working people living in poverty ― skipping meals, getting into debt, and going without the basics. Using ILO data on in-work poverty, Oxfam found that 66% of workers in low-income countries earn poverty wages -a level of pay that doesn't clear the $3.65 Purchasing Power Parity (PPP) poverty line. This is a 1% increase since 2020, which marked the reversal of a long-term decline.
"No corporation should be shelling out to rich shareholders unless it's paying a living wage to all its workers. Governments must cap payouts to shareholders, support trade unions and legislate for living wages. We should be rewarding work, not wealth," said Ms Morgain.
