The latest wages growth figures released on Wednesday by the Bureau of Statistics show that growth has distinctly slowed, with the worst results since the middle of last year. The results confirm that, for yet another year, the government will be forced to revise down its overly optimistic predictions for wages growth that were made in the budget.

For the past couple of years the government has been preaching patience on wages growth – arguing that growth will improve, slowly but surely.

Well, the slow growth remains, but there is surely no improvement. The latest figures for the September quarter showed private-sector wages grew by just 0.5% – the lowest result since March last year:

And while the June quarter saw a big boost in public-sector wages off the back of the healthcare sector primarily in Victoria, in the past quarter, public-sector wages grew by the same level as the private sector.

It resulted in an overall annual wages growth of just 2.2% in both trend and seasonally adjusted terms – the lowest since the middle of last year:

And that is bad news all round. Already this week a report by Deloitte has revealed that retailers are expecting one of the worst Christmas shopping periods for some time.

Deloitte noted that “retailers started off the year with high expectations” but that “this optimism has slowly faded, with a combination of weak consumer spending, higher input prices and a subdued economy resulting in some of the toughest trading conditions in recent history”.

These latest figures will do nothing to suggest this view is overly pessimistic.

The lack of energy in the economy is highlighted by the fact that half of the 18 industries tracked by the ABS have lower wages growth now than they did this time last year:

It very much suggests a stagnation that puts absolute lie to the government’s own wages projections.

In the April budget, the government predicted that by June next year wages would be growing annually at a rate of 2.75%, and 3.25% 12 months after that:

For that to happen the next three quarters would need to average wages growth of just 0.7% – a level of growth that has not happened for over five years.

It would also require a reversal of the trend of the past nine months that has seen wages growth slow each quarter.

The treasurer and prime minister constantly state that everything is going according to plan – that the budget was preparing for an economy they knew was in danger of slowing, which is why they introduced tax cuts and planned a return to surplus.

That plan will almost certainly be revised next month when the government issues the mid-year economic and fiscal outlook. Should it continue to use the current estimates for wages growth, the entire document will be little more than a joke on a par with that found in Christmas crackers.

One bright spot is that because inflation growth is so absolutely putrid, real wages are increasing:

The figures also confirm that there has been a complete shift in the relationship between wages growth and unemployment. Currently wages are growing about 1.7% pt lower for each level of unemployment than was the case from 1998-2012:

Given the relationship between wages growth and unemployment, to see wages growing at 3.25% – which the government expects will happen by June 2021 – the unemployment rate would need to fall to around 4.0% ie as low as it has been at any point in the past 45 years.

It is worth noting the government for its part does not predict the unemployment rate falling below 5% over the next four years.

So yes, the government would have you believe that the unemployment rate is going to remain essentially steady over the next three years but wages growth is going to go from 2.2% to 3.5%.

Yeah, nah.

The figures also confirm that the relationship between wages growth and underemployment remains rock solid:

In order to get wages growth up to 3.25% the underemployment rate would need to fall from the current level of 8.4% to 7% - the equivalent of nearly 200,000 fewer workers underemployed than are currently.

During the mining boom it took four years for the underemployment rate to fall 1%pt. The government predicts it will fall by more than that in less than three years in order to produce 3.5% wage growth.

Were that to happen it would be nearly double the previous biggest fall in the underemployment rate over such a time frame.

So sure, it would be great if it would happen, but I wouldn’t be betting your next pay raise on it. But at the moment the government is betting its future surpluses on it.

• Greg Jericho writes on economics for Guardian Australia