Review of Australia’s productivity performance

Australia’s future prosperity and living standards rely on a revival in productivity growth. The 2020 Intergenerational Report shows that productivity has slowed to an annual average of 1.2 per cent since 2005 and needs to return to 1.5 per cent to be consistent with the 30-year historical average to 2018-1963 .

To positively impact productivity, the 2019 House, Income and Labour Dynamics in Australia (HILDA) survey showed that there is a real need to move away from a reliance on commodities and property to a pro-growth productivity agenda that will provide real, sustainable growth. Such an agenda will shift productivity from its current downward trajectory which, according to analysis by Trading Economics, shows Australia as one of only two G20 countries to score below 100 points for productivity. It is clear that Australia needs to look beyond the resources and property sectors for productivity growth.

Business investment has dramatically decreased after the end of the 2000s-2010s mining boom. Australia’s national comparative advantage will increasingly be built on the quality of our ideas and our human capital. This will help to address skill shortages and the flow of new technologies and businesses.

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