Why CFOs are looking to AI to solve Australia’s productivity puzzle

With Australia’s low rate of productivity growth, both the public and private sectors can look at AI and other emerging technologies to boost productive capacity.

Organisations can strategically leverage AI to uncover new insights, enhance client relationships, and tap into long-term opportunities

Over the past few years, job growth in Australia has been remarkably resilient in the face of higher interest rates, a slowing economy, and an uncertain global economic environment. Although the unemployment rate has slowly ticked up since we emerged from the pandemic era, it remains close to historical lows.

This is not a bad thing, but it’s also not the full story. More than 80 per cent of recently created jobs are in the non-market sector and are essentially sponsored by government spending that is running at near record levels of GDP. Market sector job creation, on the other hand, has essentially flatlined.

This dynamic has contributed to a labour productivity crisis, as non-market jobs typically contribute less to overall economic output than private market counterparts (because of the higher labour intensity of non-market jobs). Since its peak in March 2022, Australia’s labour productivity has fallen by 5.7 per cent, with both market and non-market productivity declining. Non-market labour productivity now sits at a near 20-year low.

David Rumbens is Partner, Deloitte Access Economics.

Why does this matter? Labour productivity is a key determinant of economic growth and overall living standards. With economic growth currently at multi-decade lows and our living standards not forecast to recover to pre-pandemic levels for some years, boosting labour productivity should be imperative for government and for business.

While the federal budget contained some useful initiatives including limiting non-compete clauses and national licensing for electricians, there has been a lack of substantive economic reform in Australia for some time.

In the absence of meaningful economic reform, the burden of delivering a much-needed productivity boost may fall on the shoulders of the private sector. The good news is that the solution to this productivity dilemma could lie in the hands of the nation’s CFOs, who control technology and AI budgets.

This year is likely to be the year where the rubber really hits the road for GenAI implementation, with most organisations spending the past two years developing use cases for the technology. Deloitte Access Economics’ latest edition of Employment Forecasts estimates this will lead to software and application programmers being the fastest-growing occupation in 2025, with almost 20,000 additional programming jobs being created – or 10 per cent of the occupation’s existing workforce.

The potential productivity upside of AI tech is clear. As far back as 2023 a Deloitte survey found daily users of AI were saving an average of 5.3 hours per week on tasks. As the technology becomes embedded in off-the-shelf enterprise tools, use cases are refined and AI literacy grows, average time saved can increase much further.

Most CFOs see this potential. The latest edition of Deloitte’s biannual CFO Sentiment Survey found that 85 per cent of the large-cap finance chiefs interviewed saw productivity and efficiency gains as the primary goal of AI projects being launched at their organisations.

Meanwhile, nearly half of CFOs believe GenAI is substantially transforming their industry or will do so within the next two years, while cost savings and expense reductions stand out as another key benefit.

The potential of AI goes beyond just timesaving and cost-cutting. Organisations can strategically leverage AI to uncover new insights, enhance client relationships, and tap into long-term opportunities.

As AI continues to evolve at a fast pace, businesses can drive significant innovation that will in turn drive productivity gains. Achieving this, though, will require exploring a broader range of possibilities and utilising more unique and complex use cases. But we’re not there yet – despite their stated AI ambitions, just 30 per cent of CFOs have adopted GenAI into their finance function.

What’s standing in the way? For one, almost half of all CFOs say competing priorities are the biggest hurdle to AI adoption at their organisation revealing why the process is slower than expected.

CFOs are juggling multiple strategic risks and opportunities while dealing with limited resources, making it tough to justify the investment in GenAI. Additionally, 39 per cent of CFOs highlighted a lack of talent and capabilities, emphasising the need for organisations to build these areas before moving forward with AI adoption.

With Australia’s low rate of productivity growth unfortunately looking like an enduring feature of our economy, both the public and private sectors can look at AI and other emerging technologies to boost productive capacity. Australia’s CFOs clearly understand this and, as keepers of the coin, will be the ones who can direct investment and drive AI implementation across our economy.

David Rumbens is partner, Deloitte Access Economics.

-

Disclaimer

This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.

Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.

About Deloitte

Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms.

Copyright © 2025 Deloitte Development LLC. All rights reserved.

-