Labour productivity slips 0.6% in March quarter: Productivity Commission
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The news: Australian labour productivity fell by 0.6% in the March quarter, while the broader economy grew by just 0.3%, according to the latest figures from the Australian Bureau of Statistics and the Productivity Commission.
The context: According to Productivity Commission deputy chair Alex Robson, the results raise serious concerns for the market sector, where quarterly labour productivity fell 0.7% and annual growth stalled at 0.4% in March, while non-market sector productivity dipped 0.3% over the quarter and 0.1% for the year.
Robson noted, in the PC’s latest quarterly bulletin, that while growth in hours worked remains strong, rising 2.2% year on year, the aggregate value of goods and services produced has failed to keep pace.
“In aggregate, we are working harder and longer, but we are not working smarter,” he said.
He added that national productivity appears structurally stuck, sitting 0.1% below March 2023 levels when the pandemic-era productivity bubble burst.
Robson also highlighted that significant infrastructure investment over the past 20 years to replace coal assets has temporarily decreased measured productivity due to the standard production lag of new energy assets.
“Australia’s labour productivity growth is going from bad to worse,” Robson said.
The bulletin zeroed in on productivity in the electricity industry, noting a productive economy “needs reliable and affordable energy”.
The source: Productivity Commission media release and quarterly bulletin
