Australia’s productivity growth has slowed to a 60-year low in the past decade and is poised to slash household incomes by 40% if the trend isn’t reversed, Treasurer Jim Chalmers will say in an address Thursday.
(Bloomberg) — Australia’s productivity growth has slowed to a 60-year low in the past decade and is poised to slash household incomes by 40% if the trend isn’t reversed, Treasurer Jim Chalmers will say in an address Thursday.
Chalmers will speak ahead of the release Friday of the Productivity Commission’s five-yearly report and preview the document’s 71 recommendations on how to lift the economy’s speed limits.
“If we stay stuck on the current course, the PC projects future incomes will be 40% lower and the working week 5% longer,” he will tell the Committee for Economic Development of Australia today, according to excerpts of the speech. Productivity growth slowed to just 1.1% a year on average in the past decade.
That’s the weakest reading in 60 years, he said, adding that it’s “worse than the decade before and barely half the rate achieved during the 1990s.”
Chalmers will hand down his second budget on May 9 and is expected to try to contain spending as officials grapple with the hottest inflation in over three decades. Part of the importance of productivity gains is that they allow wages and living standards to rise without further fueling consumer-price pressures.
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