Future incomes will be 40 per cent lower and the working week five per cent longer unless the country boosts its productivity performance, Treasurer Jim Chalmers will warn in a major speech being delivered on Thursday.
Subscribe now for unlimited access.
or signup to continue reading
As rising inflation and high interest rates squeeze household budgets and deliver workers real pay cuts, Dr Chalmers will use a speech to the Committee for the Economic Development of Australia in Brisbane to map out key areas for action to boost sustainable growth.
"Australia has a productivity problem," the treasurer is expected to say. "Our productivity growth in the past decade has been the slowest in 60 years [and] is now 22 per cent lower than the US."
The treasurer will use his speech to foreshadow the findings of a massive year-long investigation undertaken by the Productivity Commission into stagnating living standards.
READ MORE:
The treasurer is expected to say that while the government's short-term focus is on helping with cost-of-living pressures, easing supply constraints and restrain government spending, "in the medium and longer term, our success will be determined by whether or not we can lift living standards".
Boosting the nation's productivity will "enable and empower non-inflationary growth [and set the] grounds for sustainable wage increases which could lift living standards in this decade and the next," Dr Chalmers is due to say.
The Productivity Commission delivered its mammoth, nine volume, almost-1000 page report to the treasurer on February 7.
Dr Chalmers will use his speech to outline key aspects of the report, which drew on 203 submissions and evidence provided at two public hearings in helping develop 71 recommendations.
The report is expected to propose responses including building a skilled and adaptable workforce, fostering competition and efficiency and "securing net zero at least cost".
While flagging the government will not be implementing all the recommendations, the treasurer in his speech will identify government priorities. These include investing in skills, "fixing" energy markets, improving the use and adaption of technology, facilitating investment and "maximis[ing] opportunities in energy".
Adrian Rollins
Adrian Rollins is economics correspondent for the Canberra Times
Adrian Rollins is economics correspondent for the Canberra Times
