15 Aug Why the need to lift productivity – and why it might be hard
Key Points:
- The last 20 years have seen a slump in productivity growth in Australia from over 2% pa to less than 1% pa. This has curtailed growth in living standards and real wages. It will adversely affect asset class returns if allowed to persist.
- Policies to boost productivity growth include: labour market reforms; more skills training; more infrastructure spending; increased housing supply; deregulation; and tax reform.
- Unfortunately, the political pendulum has moved against many of the policies necessary to boost productivity.
