What is the average salary in Melbourne? Awards and the national minimum wage explained

What is the average salary in Melbourne?

The phrase "average salary in Melbourne" usually refers to the typical full-time adult ordinary-time earnings for workers in the city. Because Melbourne is in Victoria, the best starting point is the Victorian state index of 98, which means the average full-time worker in Victoria earns about 98% of the national line. The national line is set at 100, which in May 2026 was $2,083.70 per week or $108,352 per year (from the Australian Bureau of Statistics Average Weekly Earnings). So the average salary in Melbourne is roughly $106,137 per year before tax.

But averages can be misleading. The figure above is a benchmark for full-time adult employees, not a guarantee for any particular role. Many people in Melbourne work part-time, casually, or in jobs covered by modern awards that set different minimums. The average salary in Melbourne also varies by industry, occupation, and experience.

Awards versus the national minimum wage

A key factor in understanding the average salary in Melbourne is the difference between modern awards and the national minimum wage. The national minimum wage from 1 July 2026 is $26.44 per hour, which works out to $1,004.90 per week or $52,255 per year. That is an index of 48.2 – well below the national line. However, most employees in Melbourne are covered by a modern award or an enterprise agreement that pays more.

Modern awards are legal documents that set minimum pay rates, allowances, and conditions for specific industries. For example, the Retail Award has a minimum hourly rate for a Level 1 adult employee that is higher than the national minimum wage. The entry-level award floor is $25.74 per hour, but many awards have rates above that. When you add penalty rates for evenings, weekends, or public holidays, actual earnings can be significantly higher.

The average salary in Melbourne is therefore influenced by the mix of award-covered jobs and the rates they pay. Victoria’s index of 98 suggests that, on average, full-time workers earn slightly less than the national figure. This could be because of the industry mix – for instance, Victoria has a large share of retail and hospitality jobs, which have lower award rates. The Retail Trade industry index is 75.9, and Accommodation and Food Services is 72.5, both well below the national line. In contrast, Professional, Scientific and Technical Services has an index of 114.7, which would pull the average up.

How the salary index works

To see where your own pay sits, you can use the Salary Index. The index is your yearly gross full-time ordinary-time earnings divided by the national line ($108,352) times 100. For example, if you earn $120,000 per year, your index is 110.8 – above the national line. If you earn $80,000, your index is 73.8. The index helps you compare your pay to the national average, regardless of industry or location.

The states page shows how each state compares. Victoria at 98 is slightly below the national average, while New South Wales is 101.2, Queensland 97.9, and Western Australia 106.9. The Australian Capital Territory is highest at 109.9. These differences reflect the mix of industries and the cost of living, but the index is a pay benchmark, not a cost-of-living measure.

Awards, super, and tax

When thinking about the average salary in Melbourne, remember that your take-home pay is affected by tax and superannuation. The super guarantee from 1 July 2026 is 12% of your ordinary-time earnings, up to a maximum contribution base of $270,830. This is on top of your salary, so your total remuneration is higher than your gross pay.

For tax, the 2026–27 resident rates (excluding Medicare) are: nil up to $18,200; 15% from $18,201 to $45,000; 30% from $45,001 to $135,000; 37% from $135,001 to $190,000; and 45% above $190,000. Plus a 2% Medicare levy. So someone earning the average salary in Melbourne of $106,137 would pay about $24,467 in tax and Medicare, leaving a take-home of around $81,670 per year. That is a rough estimate – it ignores HELP repayments, salary sacrifice, and other adjustments.

Why the average salary in Melbourne is not a simple number

There is no single figure for the average salary in Melbourne because it depends on how you define "average" (mean, median, or mode) and who you include (full-time, part-time, casual). The ABS publishes median weekly earnings for full-time employees, which is often lower than the mean because high earners pull the mean up. The state index of 98 is based on mean ordinary-time earnings for full-time adults.

If you are covered by a modern award, your minimum pay is set by that award, not the national minimum wage. For example, a retail worker in Melbourne might earn $27.50 per hour under the award, plus casual loading of 25% (making $34.38 per hour). That is well above the national minimum wage. But if you are not covered by an award (for instance, a manager on a contract), your pay is negotiated individually.

The average salary in Melbourne is also influenced by the large number of public sector jobs in the city, such as in education and health. The Education and Training industry index is 105.5, and Health Care and Social Assistance is 97.8. These sectors tend to have stable, award-covered employment.

Practical steps to understand your pay

If you want to know where your salary sits, start by checking your award or agreement. The Fair Work Ombudsman provides pay guides for each award. Compare your hourly rate to the award minimum. Then calculate your annual gross pay and use the how the index works page to find your index. You can also look at topics for more on specific industries.

Remember that the average salary in Melbourne is a benchmark, not a target. Your pay should reflect your skills, experience, and the value you bring. Awards set a floor, but many employers pay above the award to attract and retain staff. The national minimum wage is the absolute minimum for award-free employees, but most people earn more.

Final thoughts

The average salary in Melbourne is around $106,137 per year for full-time adult workers, based on the Victorian state index of 98. But this figure hides a lot of variation. Awards, industry, and individual negotiation all play a part. If you are on an award, your minimum is set by that award – check the latest rates from the Fair Work Ombudsman. If you are award-free, the national minimum wage applies, but you can always negotiate higher.

The salary index is a useful tool to compare your pay to the national line. Whether you are above or below, understanding where you sit helps you make informed decisions about your career and finances.