Wage review must consider the rising cost of farming

As the Fair Work Commission considers submissions for the annual Wage Review, farmers are calling for a cautious approach that considers the unrelenting economic challenges facing the industry.

National Farmers’ Federation (NFF) Chief Executive Officer Tony Mahar said workers were entitled to the right to earn a fair and liveable wage, but a balance must be struck when considering farm businesses’ limited ability to pass on the cost of a wage increase.

“Wages are the most significant cost incurred by the agricultural sector, and labour is comparatively more expensive in Australia than our international exporting counterparts.”

Mr Mahar said while the agriculture sector had recently experienced headline highs, these must be viewed in the context of the economic realities faced at a farmer level.

“The cost of living is impacting all Australians and farmers are not exempt. The same inflationary pressures affecting workers are also making running a farm business increasingly perilous.

“Headline commodity price increases have largely been offset by eye watering rises in fertiliser, fuel and other costs, with forecasts showing prices paid to farmers are likely to exceed prices received in the years to come.

“While almost all farmers are price takers, many operate in supply chains with increasing market concentration, leaving some farmers extremely exposed to wage increases.

“A large increase in the minimum wage may see many farm businesses struggle as they continue to absorb rising input costs and will have a heightened impact on those operating in less favourable market conditions.”

Mr Mahar said it was important to address the cost of living pressures for everyday Australians and there were a number of ways the government could influence this and improve food security.

This includes creating resilient supply chains, addressing competition and workforce issues, protecting our food production system from biosecurity threats, and supporting on-farm climate change solutions. “We urge the Commission to appropriately weigh the concerns of workers and business, particularly at a time of great uncertainty in the global economy.”

The NFF’s submission can be viewed here.