Australian workers' preference for job security and shorter hours over pay rises has pushed wage growth to a fresh all-time low.
Total hourly rates of pay, excluding bonuses, rose by 0.4 per cent in the September quarter, missing market expectations of a 0.5 per cent rise.
In the year to the end of September, wages rose 1.9 per cent, the Australian Bureau of Statistics data released on Wednesday shows.
JP Morgan economist Tom Kennedy said tepid wage growth may seem odd given that employment growth remains decent and the jobless rate fell to 5.6 per cent in September.
However other measures of labour market slackness including underemployment - those working but seeking more hours - remain elevated.
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"Today's data are consistent with this view and suggest that the demand and composition of labour is still insufficient to generate a material pick-up in wage outcomes," Mr Kennedy said in a note.
Mining wages grew by just 0.1 per cent in the September quarter, from an already high base.
The wages showing the fastest growth were those of accommodation and food services workers but they were up by just 1.7 per cent in the quarter.
Over the year to September wage growth was slowest in WA, and despite solid economic conditions in the eastern states, wages only grew 2.1 per cent in NSW and two per cent in Victoria.
Mr Kennedy said the data confirmed tepid wage growth spanned sectors and states and it was tracking all-time lows.
Commonwealth Bank economist Kristina Clifton said the Reserve Bank had viewed wage growth as stabilising when it held the interest rate at 1.5 per cent earlier in November, according to the minutes of its board meeting released on Tuesday.
However, Ms Clifton said Wednesday's data showed that wage growth was decelerating, consistent with an uncomfortably high level of labour market under-utilisation and elevated job security fears.
She said wage growth continuing to drift in the doldrums could force the RBA to cut interest rates to a fresh record low next year.
"Inflation expectations for business and union officials who are involved in wage negotiations are low. This means that there is little upward pressure on wages growth from that side of the equation either," Ms Clifton said in a note.
"We don't see enough strength in the labour market to push wages and inflation higher. As such we think one per cent won't be the bottom of this cash rate cycle and that there may be more policy easing ahead in 2017."
