Almost half of all Australian households spend their entire monthly income, while one in five don’t feel confident they could raise $3000 in an emergency, a report has found.
The ME Bank six monthly survey of financial comfort found stagnant wages were leaving many Australians struggling to cover day-to-day bills.
Financial comfort of full and part-time workers saw a steep decline since February, with just a third of households reporting an increase in annual income over the past 12 months.
One in every two Australians also felt it would be difficult to find a new job, which is the highest number recorded since late 2016.
“It’s clear from the latest report that there are increased concerns around job availability and underemployment,” ME consulting economist Jeff Oughton said.
The report also revealed a decline in comfort levels from homeowners with a mortgage and renters.
“It’s evident that despite the latest monetary policy changes, there remains high levels of housing debt worry and actual payment stress among Australians,” he said.
“The number of households contributing more than 30 per cent of their disposable income towards paying off a mortgage has remained steady at about 43 per cent, while the corresponding figure for renters has risen to 62 per cent – partly reversing the improvement reported in the previous two surveys.”
Financial comfort only increased in high-income households with more than $200,000 in income a year and for those with more than $1 million in their superannuation.
Reserve Bank governor Philip Lowe has called for state and federal governments to lift wages for public servants, which accounts for a third of the nation’s workforce, arguing it would stimulate growth across the broader economy.
The government has since shutdown the proposal such a move would have negative repercussions on keeping the budget in surplus.
Nine finance editor Ross Greenwood said the RBA is also calling for more jobs to be created as a possible solution to ease concerns.
“They believe if more people are in work, there is more competition, so wages will rise,” he said.
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