Treasurer Scott Morrison says there are positive signs for the wages outlook as job creation gains momentum.
Economists expect figures this week will show the economy added a further 20,000 jobs in August, building on the near 30,000 increase in July and the 240,000 over the financial year to end-June.
"The pace of jobs growth has accelerated over the year and the participation rate has risen which suggests that people are more confident about conditions in the jobs market," Commonwealth Bank economists said in their weekly outlook.
The participation rate gauges people who are either in or looking for work.
However, nationwide wage growth continues to stagnate at its lowest level in at least 20 years.
Mr Morrison said low wage growth was not peculiar to Australia but said salaries were rising in some industries where workers were in greater demand, such as the IT security, health and construction/engineering sectors.
"That gives us, I think, some encouragement about what we can expect down the line," Mr Morrison told ABC television on Sunday.
He believes as company profits show sustainable improvement, the case for wage rises will build, especially when businesses were putting people on.
The May budget predicted wage growth of 3.75 per cent by 2020/21, compared with just 1.9 per cent now.
"As the labour market tightens, that's obviously going to lead over time to a boost in wages," he said.
"That's why I talk about the better days ahead because we can see all these things lining up - more jobs, more investment, profit performance improving."
But Labor says the treasurer is "naive and dishonest" pretending workers can get a decent pay increase by just asking their bosses.
"The treasurer knows workers can't just ask for a pay rise when their bargaining capacity is being ripped away from them," opposition employment spokesman Brendan O'Connor said in a statement.
"The Turnbull government cannot seriously try to continue to deny the inequality which hardworking Australians are experiencing every day."
