Australia needs a reset on productivity

25 August 2022

The Business Council today releases the first of a series of reports ahead of the government’s Jobs and Skills Summit, identifying the key actions and outcomes to deliver a stronger Australia.

“The key to higher wages and better living standards is a more productive economy,’’ Business Council chief executive Jennifer Westacott said.

“Australians won’t feel like they can’t get ahead until we solve the critical challenge of weak productivity growth.

“The summit is a chance to reset our ambition to drive higher wages and better living standards by investing, innovating, upskilling, doing new things and doing old things better.  

“The long-established link between productivity and real wages is undeniable. It’s no coincidence that last decade saw both incomes and productivity growing at their slowest rate in 60 years.

“Productivity is about creating more value by doing things differently, by using technology, putting improved systems in place and doing things in new ways.

“It’s driven by innovation, investment and invention.  It’s about working smarter, not harder.

“Everyone agrees that Australians’ wages should be growing faster but the only sustainable path to get there is with a more productive economy and more successful businesses. 

“And, productivity also drives down the cost of goods and services for consumers, making the wages people get go further.

“For example, it is productivity gains that have driven down the time at work required to buy a loaf of bread – equivalent to about 4 minutes of work at the average wage today compared to about 18 minutes in 1901.

“The summit is a chance to finally decide as a nation how to drive productivity harder through policies that encourage innovation, investment, reskilling and upskilling.

“We cannot afford to miss out on this chance and find ourselves deadlocked in another decade of political bickering while Australians go backwards.

“There is no silver bullet – we need to address critical labour shortages, build up skills; make it easier for people to get back into the workforce and make it much easier to do business in Australia.

“And we’ll need to find common ground on the workplace relations deadlock that has stalled progress, including restoring the purpose and function of enterprise bargaining.

“Australia’s largest employers are heading into the Jobs and Skills Summit ready to work with all participants to deliver the higher wages and more secure economy Australians want.”

Download the paper here: Maintaining full employment and growing productivity


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