Next week’s Productivity Roundtable will be a test for Jim Chalmers and Labor. Denis Hay highlights the need for real policy reform.
The Summit is being billed as a turning point for Australia’s economy. Still, unless it addresses the root causes of stagnation, it risks becoming another talk fest that serves corporate interests more than citizens. A Labor productivity summit must address wage growth, skills reform, housing, and public investment to achieve a fair economy.
Real productivity is not about working longer hours for less pay. It is about ensuring every Australian has the tools, resources, and security to contribute meaningfully to the economy. With Australia’s monetary sovereignty, the government has the power to fund the public investments needed for genuine productivity gains.
Australians feel stuck.
For over a decade, wage growth has lagged inflation, even as Australian economic productivity has risen. This disconnect means workers produce more value but see none of the benefits.
Insecure work, casualisation, and gig jobs erode stability and reduce the incentive for long-term skill development. Social Justice Australia has previously warned that ignoring this will deepen inequality.
Workforce skills reform is essential, yet TAFE and public universities have been underfunded for years. Private training providers often prioritise profit over quality outcomes. Without accessible, fully funded training pathways, Australia risks falling behind in the global skills race.
Universities in crisis amid savage cuts to staff and services but, hey, big profits are back
The productivity conundrum
High housing costs, overburdened health systems, and unreliable public transport leave workers stressed and less able to perform at their best. For example, long commutes eat into time that could be spent on rest, learning, or community engagement.
Our housing crisis analysis shows that unaffordable rents and mortgages are now a significant drag on productivity.
Meanwhile, corporations reap record profits while wages stagnate, thanks to policy settings that favour capital over labour. Public money is too often channelled into subsidies for big business rather than direct investment in communities.
This privatisation of gains and socialisation of losses undermines both fairness and long-term productivity.
Some solutions
With a sovereign currency, Australia can fund strategic public investments without relying on private capital. This includes:
- Expanding public housing to stabilise the workforce
- Rebuilding manufacturing capacity for supply chain resilience
- Funding free education and TAFE to meet future skills needs
These measures align with Modern Monetary Theory principles, showing that budget constraints are political choices, not economic necessities.
The Labor Productivity Summit must deliver:
- A wage growth plan tied to productivity gains.
- Fully funded public skills training
- Investment in green energy and digital infrastructure
- Affordable housing as economic infrastructure
- Stronger workplace rights to reduce casualisation.
A former teacher and counsellor, Denis runs the Social Justice Network, fighting for social justice & against neoliberalism and advocating for equality in housing, jobs, education, and healthcare.