The Productivity Commission is warning of dire consequences for everyday Australians unless urgent action is taken, but Jim Chalmers says the government won't 'agree' with all the recommendations made in a new report.
The 1,000 page report includes 71 recommendations and identifies five key areas to address: building a skilled and adaptable workforce, harnessing data and digital technology, increasing competition and dynamism in the economy, raising non-market productivity, and securing net-zero emissions at the least possible cost.
The main area of focus was Australia's booming services sector which now accounts for 80 per cent of the economy and 90 per cent of the workforce. "Over the past 35 years in Australia, the expansion of employment in the services sector has been mainly in government-subsidised and regulated services, like health care and social assistance," he said.
When low-productivity sectors take up a majority of an economy they begin to act as a drag in an effect known as"cost disease". "The primary reason we want to make our economy stronger and more productive is so that we can lift incomes and lift living standards," he said.
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