How to make frame wrap contents?

I have a frame with a single item in it. There are 12px horizontal/vertical padding.
As you can see, auto-layout is enabled:

Ideally, if I increase the padding, I would like the height of the frame to increase. In other words, I would like the height of the frame to fit its content. Is this possible, and if so, how do I do it?

Set the text layer’s Horizontal resizing to “Fill” and its Vertical resizing to “Hug”