The National Retail Association has today blasted the national wage increase as “completely out of touch with reality”, saying it ignores the financial pressure most businesses are currently facing.

National Retail Association Chief Executive Dominique Lamb also expressed concern that the figure will simply add to inflationary pressures, which the Reserve Bank today warned could hit seven per cent by the end of this year.

“This increase is completely out of touch with the reality of modern business, and it will result in many workers losing their jobs,” Ms Lamb said.

“This comes on top of two recent interest rate hikes, which will drive up overdraft and business loan payments, and will coincide with the 0.5 per cent jump in superannuation from July 1.

“It will be the third strike for retailers, many of whom have not been able to pay their rent for the last two years and are also facing increase input prices, particularly in the restaurant and fast food sector.

“The simple fact is that when businesses don’t have enough money to cover their expenses, they need to cut costs. There is no doubt that those cuts will lead to job losses in retail and no doubt in other areas of the economy as well.”

Ms Lamb said the Fair Work Commission had taken the extraordinary step of exceeding the initial ambit claim made by the union movement, of 5.0 per cent, and almost matching the ACTU’s even higher revised claim of 5.5 per cent.

“Employer groups, including the NRA, have tried in recent years to propose modest but affordable increases for our valuable staff.

“Sadly, it seems this reasonable attempt at finding sensible middle ground has backfired.

“When the Commission pays no attention to our concerns and simply listens to only one side of the argument, it may be time for employers to stop trying to be reasonable.”