Why New Graduate Physiotherapy Wages Aren’t the Real Problem

There’s a lot of anxiety right now about proposed changes to new graduate physiotherapy wages. Much of the conversation focuses on affordability, risk, and whether clinics can survive if base wages increase.

But when you step back and look at the numbers — not the headlines — a different picture emerges. The issue isn’t that wages are rising. The issue is that award wages have lagged market reality for years, and parts of the profession have quietly built business models around that gap.

Market rates vs award rates: what’s actually happening

By the end of 2025, most clinics advertising for new graduate physiotherapists were offering salaries in the range of $70,000–$80,000. In some sectors — particularly home-based care and larger corporate models — advertised salaries were often $85,000+, sometimes before incentives.

Superannuation is typically paid on top of these figures, a detail often forgotten when award rates are quoted.

By contrast, the current award base rate sits around $32–33 per hour, roughly equivalent to $65,000 per year before super. You can view the full Health Professionals and Support Services Award here:

Health Professionals and Support Services Award (MA000027)

That gap already exists — regardless of whether awards change or not. So only one of two things can be true:

• Either most new grads are already being paid closer to market rates, or
• Large parts of the profession are relying on award minimums well below market reality

What the proposed increase actually does

A commonly cited figure is a proposed uplift of around 28% to the base award rate. Applied to current numbers, this moves the hourly rate to roughly $41/hour, or about $81,000 per year.

On paper, that’s a meaningful jump — around $16,000–$18,000 per staff member once super is included.

But it’s important to be clear about what this does and doesn’t change. For the majority of clinics already paying market salaries (often with incentives), very little changes. The biggest impact falls on clinics paying award only.

Who is most affected — and why

Award-only clinics are typically:

• Charging lower fees
• Encouraging higher service volume
• Operating on thin labour margins

That’s not a wage policy issue — it’s a business design issue. These models rely on low labour cost to function. When labour cost rises, the fragility becomes visible.

That doesn’t mean every clinic in this category is “bad” or poorly run. Some are early-stage businesses still finding their footing. But beyond the first year or two, a clinic that can’t pay professional wages without distress is structurally vulnerable.

The attrition problem we keep ignoring

New graduate attrition isn’t mysterious. The data has been consistent for years.

When someone completes a 4–6 year health degree and enters the workforce earning only marginally more than entry-level retail, the signal is clear. It undermines confidence, discourages long-term investment in skill development, and accelerates exit from the profession.

This is exactly what we’re seeing: high early-career attrition and chronic workforce churn.

Why slow change doesn’t protect the profession

There’s a belief that phasing wage increases slowly reduces risk. In reality, it mostly delays it.

Slow reform:

• Stretches financial pressure over years
• Encourages denial instead of adaptation
• Keeps unsustainable models alive longer

Faster alignment between award rates and market rates forces clarity. Some businesses will need to adjust pricing. Some will improve efficiency. Some will exit. Others will open.

That transition is uncomfortable — but it’s how markets actually recalibrate.

Putting the numbers in perspective

For most small clinics, this isn’t about funding dozens of graduate salaries. It’s usually one or two staff members.

An additional $10,000 per staff member per year equates to roughly:

• $50 per day
• $250 per week
• ~2–3 appointments

That’s not trivial — but it’s also not insurmountable. Especially when weighed against the cost of turnover, recruitment, onboarding, and lost productivity.

The real issue

If a business model only works by paying the absolute minimum for professional labour, that’s not a wage problem. That’s a design problem.

Raising base wages doesn’t break good businesses. It exposes weak ones.

If we want people to stay in the profession, we have to pay them like we want them to stay. Everything else is noise.