SA Productivity Commission chairman Adrian Tembel reveals 8 per cent wage gap, backs university merger

SA is missing out of billions because of a growing 8 per cent wage gap with the rest of the nation – but the uni merger would ease that, a major report says.

A growing 8 per cent wage gap between South Australia and the national average can be eased by merging the universities of Adelaide and South Australia, says SA Productivity Commission chairman Adrian Tembel.

In a major report handed to Premier Peter Malinauskas, Mr Tembel revealed his independent group backed the proposed merger as a priority to tackle the state’s wages and innovation challenges.

Mr Tembel told an Adelaide Economic Development Agency forum on Wednesday that South Australians had earned 5 per cent less than the average Australian at the start of this century but this gap had swollen to 8 per cent.

“While 8 per cent may not seem huge, I make two points. First, try telling all South Australian workers that they are going to receive an 8 eight per cent pay cut,” he said.

“Second, if all of our 950,000-plus workers earned 8 per cent more – that is, just improved to match the national average – there would be an additional $6.5bn being spent, invested, saved or paid in taxes in our economy every year.

”That is nearly a third of the annual expenditure of our whole state government into the economy. Our wage gap matters.”

SA Productivity Commission chairman Adrian Tembel. Picture: Kelly Barnes

Mr Tembel rejected the argument this wage gap did not matter because Adelaide housing was cheaper, branding this claim “a myth”.

“Housing affordability in Adelaide is actually currently worse than the national average and, more specifically, worse than in Perth, Brisbane and Canberra,” he said.

This demonstrated SA’s innovation policies of the past 30 years had not worked, including the now-infamous and failed multifunction polis futuristic city.

Rather than governments abandoning activist innovation policies, he said, their focus should switch to developing universities and research institutions.

The city’s three universities had 26,000 postgraduate students and 4000 academic staff – a concentration unmatched in the private sector.

Mr Tembel said these researchers and academics needed to be more motivated to have “an economic impact in South Australia”, barriers removed to getting their science from the laboratory to the boardroom and maximising incentives for this to happen.

More support must be created for these innovation workers, particularly early in their careers, to continue “in well-funded and secure research and development jobs in South Australia for longer”.

Mr Tembel said the state government needed to drive these changes with “appropriate leadership and incentives”, plus a well-crafted, carefully implemented and adequately funded reform agenda.

Universities operated under a social licence from the SA people, he said, which extended beyond educating high school students.

”Our universities, we believe, have a leadership obligation to help drive South Australia towards an innovative and high-wage future,” he said.