Businesses would be worse off and jobs would be lost if the minimum wage was hiked up as much as unions want, a peak body representing Australian employers has warned.
The Australian Industry Group has expressed the sentiment in a fresh submission to the Fair Work Commission's annual minimum wage review.
In its original submission to the review, the business group argued the minimum wage should be lifted by two per cent this year, marking an increase of about $14.40 per week to the current level of $719.20.
The modest increase is necessary because the economy has moved into the "slow lane" and businesses are struggling to cope, it said.
The Australian Council of Trade Unions called in its submission for an increase of six per cent, equivalent to a weekly increase of $43.
ACTU secretary Sally McManus said the significant spike is needed to ensure that no full-time worker is living in poverty.
In a reply published on Monday, the Ai Group says what the unions want is "obviously unsustainable".
"A minimum wage increase of this magnitude would be a certain way to destroy jobs, harm businesses and threaten Australia's long period of economic growth," the document reads.
This month's federal budget acknowledged that Australia's economy is slowing by revising down forecasts for growth, it noted.
The Ai Group says the budget also promised an increase to a tax offset for low and middle income earners, which will increase the disposable income of people earning the current minimum wage.
The discussion comes after federal Labor last month urged the industrial umpire to lift the minimum wage but won't nominate a figure.
That prompted grave warnings from the coalition about job losses and economic damage.