Ultimately unproductive

Remember productivity?

For a week or so last August, it was all the rage. There was a roundtable, everyone read Abundance (or claimed they did), and op-ed column inches were gleefully filled by anyone who did  economics for the HSC. 

And since then? Well, there’s been a couple of policy adjustments, including a pause in the National Construction Code, and some amendments to the Environment Protection and Biodiversity Conservation Act. But it doesn’t appear to be the unstoppable movement Abundance called for.

If anything, we may be moving in the wrong direction. According to David Larocca, EY CEO for Oceania, the economy can’t get out of second gear in the wake of stalled productivity. 

Meanwhile, the great hope of productivity, artificial intelligence, is proving to be less impactful than many had hoped. 

A study of 6,000 CEOs, chief financial officers, and other executives from the US, UK, Germany, and Australia found nearly 90% of firms said AI has had no impact on employment or productivity over the last three years.

The challenge of fixing this is incredibly complex. There are thousands of policy levers to pull, from the genuinely revolutionary to the highly specific. What they have in common is that they take time to work. 

Patience is not something we’re particularly good at as a culture, especially when pressure on businesses, wages, and mortgages all feel increasingly crushing. 

Communicating progress that satisfies our constant need for updates, while accepting the turning-the-tanker nature of this challenge, is tough. But it’s undoubtedly easier with something shiny and significant to point to every so often. Whatever happens, just don’t make people read Abundance again.