The Reserve Bank of Australia (RBA) governor Michele Bullock, who earned $1.22 million in 2025-2026, is urging her staff to accept a pay deal that would effectively cut their real wages. The rejected three-year offer included a 3.7% increase in the first year, followed by 3% in 2028 and 2.8% in the subsequent year. However, with inflation running at 4% annually, this deal would reduce their purchasing power. The RBA acknowledges that its staff would be 'going backwards at a high speed' under this proposal.
Meanwhile, a street in Melbourne's inner west, Sanderson Street in Yarraville, has become a symbol of the fragility of the trillion-dollar AI infrastructure build-out. Residents' protests against large power poles for NEXTDC's data center led to a $3 billion drop in the company's value. NEXTDC revealed projected revenue would drop by one-third, halting some center builds and considering selling land-banked sites. This incident highlights the potential fragility of the AI-powered company ecosystem.
Adding to the economic uncertainty, National Australia Bank (NAB) announced it would cut 2,500 jobs, most by Christmas, to 'simplify its operating model.' The cuts were not directly attributed to AI, but staff reported that automation was a factor. Swinburne University governance expert Helen Bird noted that NAB failed to explain to investors how it would achieve the cited benefits from these cuts.
Senior NASA engineer Jeevan Perera warned that AI and automation could eventually replace any job. As the RBA's monetary policy board considers a potential interest rate rise, the economic outlook for 2027 appears increasingly shaky, with businesses expecting inflation to stay above 3%, leading to a potential 'central banker's nightmare' of slumping consumer spending and business confidence.