Englishheadline Political Editor Andrew Clennell says higher unemployment was predicted but the “greatest economic fear” over the next year must be stagflation.
Unemployment rose from 3.5 to 3.7 per cent a day after the wages figures were released, showing they are also up.
“The hope would be if unemployment goes up, inflation comes down”, Mr Clennell said.
The ACTU wants a wage increase of seven per cent while the Australian Chamber of Commerce and Industry wants 3.5 per cent, according to Mr Clennell.
“The government continues to maintain such a wage rise would not have an effect on inflation.”