Australia's labor market remains tight and on a solid footing, but is not materially strengthening at this stage, according to the latest Commonwealth Bank of Australia (CBA) Wage and Labour Insights report released on Tuesday.

Australia's wage growth held steady in January, with CBA data showing quarterly wage growth at 0.8% and annual growth at 3.1%, CBA said, while adding that wages have been tracking broadly sideways, though there has been a gradual increase in quarterly outcomes since mid-2025.

CBA's Labor Insights indicate the economy added an estimated 21,000 jobs in January. CBA said that employment growth remains solid but is gradually moderating.

Western Australia continued to report the strongest wage gains, while outcomes across the eastern states remained steady.

CBA economists continue to expect one further interest rate increase in May, which would take the cash rate to 4.1%, while monetary policy adjustments, according to CBA, are likely to involve fine‑tuning rather than a renewed tightening cycle.