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No quick fix for higher living standards

Productivity and incomes in Australia are driven by research and education. And the hard truth is that we, as a country, have given up on funding either of those things properly.

Richard Holden

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While our politics is increasingly focused on feel-good sound bites, the immutable forces of economics don’t succumb to marketing spin. Politicians can tell voters what they want to hear, but the laws of economics won’t listen.

That brings us to productivity growth in Australia. Or more precisely, the lack thereof. Between 1995 and 2010 labour productivity in Australia averaged 2.2 per cent a year. Since then, it has averaged 1.5 per cent a year. Australia’s productivity ranks 15th out of 24 among advanced economies.

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    Original URL: https://www.afr.com/policy/economy/no-quick-fix-for-higher-living-standards-20220405-p5ab42