Essential Report

Workers’ productivity

Jul 29, 2013

Q. Overall, in your experience, how productive are most Australian workers?




Vote Labor

Vote Lib/Nat

Vote Greens

Full time workers

Part time workers


30 Jul 12

6 Feb 12

Very productive









Quite productive









Not so productive









Not at all productive









Don’t know









67% think that overall, most Australian workers are very or quite productive. This figure has fallen a little since this question was asked in July last year.

Labor voters (75%) are more likely than Liberal/National voters (64%) to think workers are productive. There were no substantial differences across income or age groups.

Austerity Makes You Sick

Aug 22, 2012

Austerity is a bad thing. As I’ve pointed out before, when an economy is suffering from lower demand, the last thing you want to do is squeeze the pocketbooks of the very people who you want to have out there spending money. But, here’s another thing: it makes you sick. Literally.

So, say a group of doctors who have looked at the madness of austerity sweeping through Europe. The doctors— Martin McKee, Marina Karanikolos, Paul Belcher and David Stuckler—found that:

However, austerity has been not only an economic failure, but also a health failure, with increasing numbers of suicides and, where cuts in health budgets are being imposed, increasing numbers of people being unable to access care. Yet their stories remain largely untold. Here, we argue that there is an alternative to austerity, but that ideology is triumphing over evidence.


For many months, the political and financial aspects of the crisis have filled the headlines. However, behind those headlines, there are many individual human stories that remain untold. They include people with chronic diseases unable to access life sustaining medicines, persons with rare diseases who are losing income support and forced to care for themselves, and those whose hopes of a better life in the future have been dashed see no alternative but to commit suicide. So far, the discussion has been limited to finance ministers and their counterparts in the international financial institutions. Health ministers have failed to get a seat at the table. As a consequence, the impact on the health and well-being of ordinary people was barely considered until they made their feelings clear at the ballot box.

I would add a more specific observation not touched on by the doctors, with the caveat that I could only play a doctor on television. The depression people feel has to be about the feeling that, hey, “I had nothing to do with this crisis, it was brought on by greedy bankers but you are blaming me for it and making me pay the costs”. There has to be an element of anger, frustration and despair.

This is all relevant to what we see happening in Australia. True, austerity is not the order of the day. But, when The Coalition and its business allies are, every day, telling people productivity isn’t high enough and its the fault of workers — even though the productivity crisis is a myth—and, when those same forces, The Coalition and its business allies, attack relentlessly the Fair Work framework — even though that Fair Work framework has benefited people throughout the country— it is not a big leap forward to a society where the health of our work workers declines because of the stress they feel at work.

Remember, forty percent of Australians are shackled with insecure work. That makes for a landscape that will hurt people—not just in their bank accounts but in their physical well-being.


The Productivity Myth

Aug 20, 2012

Over the past few weeks, I’ve pointed out how often we have to try to challenge rhetorical nonsense about the economy that spills from the mouths of The Coalition and their business allies. Blinding rhetoric, too often, substitutes for truths about the economy. And one of the particular myths we hear, time and again, is the idea that workers are not productive “enough”. It’s not true.

Ian Verrender had a terrific column over the weekend that should not be missed. Titled “Lies, damned lines and productivity”, Verrender leads right off with a quote about the power of propaganda from Joseph Goebbels and, then, hits the issue:

For the past few years, we’ve been bombarded by a constant theme from the business lobby groups: Australian productivity is slipping and unless we have a more flexible labour market and governments reduce regulation, we’ll all be ruined.

There’s a sliver of truth to the argument. Productivity indeed has plunged. And labour productivity has slipped in recent years. But the real culprit in the great Australian productivity decline is capital, not labour. It is our managers who have let us down, rather than our workforce. And in any case, all the statistics have been thrown completely out of whack by the massive investment boom in our resources sector. [emphasis added]

That sentence bears repetition and should be branded on the chests of every politician or CEO who regurgitates productivity myths: But the real culprit in the great Australian productivity decline is capital, not labour. It is our managers who have let us down, rather than our workforce.
Verrender, then, goes on to explain what productivity actually means, coming to another golden nugget:

What is often ignored in this heated debate is that, outside of work hours, labour usually is referred to as consumers. Your workers are also your customers.

Reduce their income and eliminate their job security and you may well end up selling less product. On the other side of the ledger, productivity is also likely to suffer. Let’s face it, cutting wages and conditions is hardly an incentive to work harder.

This is a point that I have made in connection with the cries for austerity around the world: people are dead broke, or so stressed out over their future employment that they don’t want to buy. The problem is not government deficits or debt, another myth that has grabbed hold of brains of political leaders all across the planet. It’s that the Great Financial Crisis, and the years of greed on the part of bankers and other financial mandarins leading up to the Crisis, triggered a sharp fall-off in consumption. Leveraged to the hilt and with dwindling incomes, people pulled back—and stopped buying stuff.
Verrender’s point is right on the mark: if you hammer workers by cutting wages in some blind, and misguided, pursuit of higher productivity, you end up hurting the economy—and society as a whole.
Verrender, then, moves to the obvious culprit in any productivity debate:

Capital productivity on the other hand, has turned negative, wiping $43 billion from national income. Why? Well, a couple of reasons. One is that much of the enormous recent investment in new machines and building new mines has yet to generate an income. And so as that new plant and equipment starts churning out exports, a great deal of our productivity ”problem” – both for labour and capital – will be solved.But the report also highlights what must be an uncomfortable truth for Australian managers, particularly in our resources sector. It reckons a large portion of the cost increases in our mining sector is down to poor management. With a resources boom of unprecedented proportions, the scale and magnitude of the projects under construction has stretched management capabilities, many of whom have little experience with these mega projects. [emphasis added]

The workers are not to blame? Huh. Fancy that.Which of course leads to the obvious conclusion:

Our productivity ”problem” will best be solved through investment – in new and more efficient machines and in education to produce more skilled workers and better managers – not with a slash-and-burn approach to wages and conditions. That’s something you’re unlikely to hear in the coming propaganda war. [emphasis added]

It would be nice if we could have a realistic debate about productivity. Any takers?

Blinding Rhetoric

Aug 15, 2012

Think “juicy steak”. Unless you are a vegetarian, your mouth watered or your stomach told you that you were hungry. “Juicy steak” is a phrase that triggers physical and emotional reactions; it will blind you from thinking clearly about anything else…at least for a minute or two. CEOs who run around tossing out phrases like “surging labour costs” and “lower productivity” are using the “juicy steak” strategy—they want to trigger emotional responses that blind people.

So, when you read this report in the Financial Review about a survey of the CEO Forum Group:

International companies have warned the Gillard government that they may scale back investment plans in Australia due to carbon pricing, surging labour costs, the high dollar and political uncertainty.

Leading executives of multinational corporations claim that Australia’s business-friendly reputation is at risk and parent companies could shift resources to Asian nations.

…Membership to the forum is restricted to the country head, chief financial officer and top human resources executive of multinational subsidiaries operating in Australia, including Coca-Cola, KPMG, Credit Suisse, Citibank, Accenture, GM Holden, Colgate-Palmolive, Campbell Arnott’s, BP and GlaxoSmithKline.

Remember this:

1. The heads of these companies make millions of dollars in pay and benefits and not a one—not a single one—has offered to give back a dime of their obscene compensation.

2. “Surging labour costs” is a crock, if you look over the course of several years. The actual official statistics at the Australian Bureau of Statistics shows that over the period 2008-2011, compensation averaged about 4.4 percent—at the same time that housing costs alone rose more than 3 percent and other costs to just live rose as well, eating up any compensation hikes in real terms. Just in the past quarter, price rises for  medical and hospital services increased 2.8%, rents 1.1% , and vegetables +5.2%. Bottom line: people are not living high off the hog.

3. Not to mention, forty percent of Australians are in insecure work.

4. Carbon pricing, as the Prime Minister correctly pointed out recently, has very little to do with higher electricity prices—which are higher for a whole set of reasons pointed out here.

5. A high dollar is a direct result of a resource industry boom that the elites have embraced without question—which could also be managed and controlled with the right policy…which would bring the dollar back down to a more sustainable level.

6. The threat to to shift production to Asian nations is a coded phrase that translates into “we want to go where we can find slave labor”.

The basic point is: there needs to be a countervailing message to destroy rhetorical themes that trickle into daily conversation, trying to convince people that what we need are more policies that give more to the elite and less to workers.


Workers’ Productivity

Feb 6, 2012

Q. And overall, in your experience, how productive are most Australian workers?

Total Vote Labor Vote Lib/Nat Vote Greens Full time workers Part time workers
Very productive 15% 20% 14% 16% 18% 14%
Quite productive 59% 63% 57% 58% 58% 62%
Not so productive 19% 13% 24% 19% 19% 18%
Not at all productive 2% 2% 3% 1% 3% 1%
Don’t know 5% 3% 2% 7% 3% 4%

74% think that overall, most Australian workers are very or quite productive.

Labor voters (83%) are more likely than Liberal/National voters (71%) to think workers are productive. There were no significant differences across income or age groups. Comments »


Sep 12, 2011

Q. Some business leaders have recently claimed that to increase productivity, industrial relations laws need to be changed to give businesses more flexibility around how they employ workers, including re-introducing individual contracts. Do you agree or disagree?

Total Vote Labor Vote Lib/Nat Vote Greens
Total agree 40% 27% 59% 17%
Total disagree 42% 61% 24% 61%
Strongly agree 11% 6% 19% 2%
Agree 29% 21% 40% 15%
Disagree 22% 29% 17% 23%
Strongly disagree 20% 32% 7% 38%
Don’t know 18% 11% 17% 21%

Opinions about the need for changes to industrial laws to increase productivity were divided. 40% agreed with the need to change IR laws and 42% disagreed. 61% of Labor voters and Greens voters disagreed, while 59% of Liberal/National voters agreed.

Those aged 35-54 tended to disagree (35% agree/47% disagree) while those aged under 35 (40%/34%) and 55+ (48%/42%) were more likely to agree. 46% of full-time workers disagreed and 43% agreed.

Comments »

Productivity in Australia

Feb 2, 2010

Q. The Prime Minister Kevin Rudd recently said that over the next decade Australia must build the best educated, best skilled and best trained workforce in the world to increase productivity and counter the effects of an ageing population. Do you agree or disagree?

Total agree 82%
Total disagree 8%
Strong agree 34%
Agree 48%
Disagree 6%
Strongly disagree 2%
Don’t know 10%

 The majority of those surveyed agree with Kevin Rudd’s recent comments that over the next decade Australia must build the best educated, best skilled and best trained workforce in the world to increase productivity and counter the effects of an ageing population (82%), 8% disagree with the comments and 10% don’t know. 

 Results were consistent amongst most demographic groups.  However, Labor voters were more likely to strongly agree with Rudd’s statements (46%).  Comments »


Read Essential's ongoing research on the public response to Covid-19.

Sign up for updates

Receive the Essential Report in your inbox.
  • This field is for validation purposes and should be left unchanged.