Chapter 1 - Introduction

1.1 The Wage Price Index (WPI) is an important economic indicator. It measures changes in the price employers pay for labour due to market factors. The WPI is compiled by the ABS for quarters ending in March, June, September and December each year. The quarterly index numbers are published approximately seven weeks after the end of each quarter in the publication Wage Price Index, Australia (cat. no. 6345.0).

1.2 This publication provides information about the concepts, sources and methods used to compile the WPI. Specifically, it provides information on: 

• purposes and uses of the WPI
• historical background
• price index theory
• coverage and classifications
• sampling
• weights and their sources
• price collection
• quality change
• WPI calculation in practice
• re-referencing and linking price indexes
• outputs and dissemination
• the system of price statistics in the ABS

This publication is intended for users who wish to gain a deeper understanding of the index.

1.3 Wage Price Indexes (WPIs) were first produced by the ABS in the December quarter 1997. In the September quarter 2004, the inclusion of non-wage indexes complimented the existing suite of WPIs and were combined to create Labour Price Indexes (LPIs). In March 2012 ABS program reductions led to the non-wage and LPI indexes being discontinued, with the September quarter 2011 representing the last in the series. This version of the Concepts, Sources and Methods publication focuses on information pertaining to WPIs. More information on the LPIs can be found in the Labour Price Index: Concepts, Sources and Methods, 2004 (cat. no. 6351.0.55.001).

1.4 The ABS intends to update this publication periodically. Individual chapters will be updated on an ongoing basis but updates to the whole PDF version of the document will only take place biennially. The ABS would welcome comments from the users of statistics covered in this publication. You may direct your comments or questions to:

Wage Price Index Section
Australian Bureau of Statistics
Reply paid K881
Perth WA 6842

by telephone: (08) 93605151

or by email: wage.price.index@abs.gov.au