A stronger-than-expected increase in private sector pay over the last three months of 2020 has kept wage growth above (very low) economist expectations, as many bosses reversed COVID pay cuts or freezes.

Australians' pay packets rose an average of 0.6 per cent over the last three months of last year, double the 0.3 per cent expected by most economists.

But many Australians, particularly those relying on awards for pay increases and public servants whose wages have been frozen by governments, are falling behind.

Kylie Grey has been working in the early childhood sector in Melbourne for 11 years.

She said in that time the annual award rate increase had not kept up with the cost of living.

"It's generally only ever something under about a $1 increase per hour," she said.

"As we all know, rent, food, expenses, they have skyrocketed and there's no way my wage has kept up with that."

The mother of three teenagers is currently studying for a higher qualification in her field, but she said even once she has obtained her diploma, her capacity for a pay rise will be minimal.

"It means you end up sacrificing things, whether it's going out, holidays or buying your own house and just having a safety net of savings," she said.

However, Ms Grey is in the relatively fortunate group of award workers who got their 1.75 per cent annual pay increase on the usual date of July 1 last year.

Many workers in those industries deemed hardest hit by the pandemic, including those employed in hospitality, arts and recreation, aviation, retail and tourism, have only just received theirs from February 1.

Wage freezes still commonplace

Wage growth over the year remained at a record low of 1.4 per cent, and the ABS's head of price statistics, Michelle Marquardt, said that was despite a number of one-off factors lifting the outcome.

"December quarter's moderate growth was influenced by businesses rolling back short-term wage reductions, returning wages to pre-COVID levels," she noted.

"The phased implementation of the Fair Work Commission annual wage review also had a small positive impact on wages."

ANZ economist Catherine Birch said other information from businesses indicates that substantial pay rises are a long way off.

"Although we saw wage cut reversals really boost growth in this quarter, the RBA, based on its business liaison program in the December quarter, reports more than 60 per cent of business either currently have a wage freeze in place or expect to put one in place," she told ABC News.

Unusually, it was the private sector that led pay rises over the quarter, with wage gains of 0.7 per cent, seasonally adjusted, while public sector wages edged just 0.3 per cent higher.

"Wage freezes have had an impact on the public sector, which recorded its lowest annual increase (1.6 per cent) since the commencement of the series," Ms Marquardt said.

She explained that regions and sectors that were recovering from pay cuts had the strongest December quarter figures, with professional, scientific and technical workers booking a 1.2 per cent increase having suffered a half a per cent fall in wages in the June quarter.

Victoria, reopening after a second lockdown, recorded the strongest December quarter wage growth of 0.7 per cent.

Recruiters say pay offers improving

Angela Franks, who recruits for HR roles in Sydney, told ABC News she did not see any real wage growth in 2020.

In fact, she saw the opposite.

Ms Franks saw about a 50 per cent fall in recruitment for most of last year, which only began reversing in December and into this year.

That fall in the number of jobs on offer has pushed the power to set wages further into the hands of employers, who are trying to save on costs to offset a dismal year.

However, Ms Franks is expecting the next quarter to show a better lift in wages.

"We're seeing a lot more recruitment roles coming online and being advertised, which is a really positive sign that the job market is going to start heating up, which will help drive that wage growth," she observed.

The story has been much more positive in the West.

Closed borders and a surge in demand from China for Western Australian iron ore mean workers in the mining sector have the upper hand when to comes to negotiating their wages.

"There's big demand for technical and professional people and we're constrained by the supply, so naturally that has pressure on rates," Perth recruiter Matthew Iustini told ABC News.

His resources recruiting firm started 2020 with 500 contractors on its books.

By the end of the year, that had grown to 850.

"We probably haven't seen it go like last time in the boom, it hasn't accelerated in the same way, but we're certainly seeing lots of upwards pressure," he said.

Mr Iustini said his new contractors benefited from a 5 to 10 per cent pay increase last year.

Ms Franks is already seeing her clients revise the salaries they are prepared to pay.

A small Brisbane-based tourism business she recently recruited for realised they needed to offer more money than they originally wanted, to hire a new recruit.

"They've had to increase the salary they were offering by 25 per cent to get that person," she said.

Despite the lift, it was still a pay cut for the successful applicant.

"The candidate has actually taken about a 20 per cent pay cut to take that role because she loves the business and it's close to her home," she explained.

"The problem we have is that the data doesn't tell those stories."