Economy

Jan 22, 2018

The overlooked area of our economy that could hold the key to productivity

We talk a lot about productivity but rarely with any seriousness. And we might not even be looking in the right place for growth.

Glenn Dyer and Bernard Keane

Crikey business and media commentator / Politics editor

Let's talk seriously about productivity.

We talk all the time about productivity, of course. From around 2010 to 2015, we were obsessed with a "productivity crisis". It was only last year that Treasury produced a paper acknowledging we'd been obsessing over nothing when it came to labour productivity, because it had substantially increased after 2007-08, compared to the large fall that coincided with John Howard's WorkChoices.

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4 comments

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4 thoughts on “The overlooked area of our economy that could hold the key to productivity

  1. Robert Johnson

    So it’s the super industry! I just knew that the unions were behind poor productivity.

  2. BrianD

    The answers will be hard to find if we keep analysing economics as if it is its own universe separate to the environment it operates in. The Treasury paper fleetingly mentions that ‘the Agricultural sector was hit by drought’ when the large downturn in national productivity occurred (1999 to 2010). Drought is one way to describe it. Another is: the hottest and driest decade ever recorded followed by the largest floods on record in the Murray basin. And what’s more, this stuff was not just part of cyclic variation but totally consistent with projections of more frequent extreme conditions. It did not just mean there was a lot of farm machinery sitting round idle. It affected the Australian environment, society and economy as a whole translating into much greater loads on the energy sector, a huge escalation in annual emergency services and public health costs, new building code costs to deal with fire and storm, and ratcheting up of insurance costs and withdrawal of cover. You rightly mention the Productivity Commission’s carbon price recommendation. But if that continues to be seen as primarily an economic allocation mechanism – like a bill splitting app that keeps us from unconsciously spending too much on take away – the mining lobby groups and others will continue to kill it off. It’s not an app – to help us save up for and invest in nicer carpets. It’s a sprinkler system to stop the whole bloody house burning to the ground.

    1. Dog's Breakfast

      Agreed Brian. The whole issue of measuring ‘productivity’ is a farce, a statistical piece of bullshit as egregious as any that is currently going the rounds

  3. klewso

    I like the irony and self-deprecating humour of the Mineral Council of Oz.
    FFS, along with that LOL prognostication re “Company Tax Cuts -> MCAxBS” equation, they really expect us to swallow that “Royalities (to governments to extract our common mineral wealth and to profit from sale of said commodities) = Tax” slurry of slag?
    How much do their CEOs get paid for that sort of high cant hi jinx?

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