Productivity across the public service and government-funded industries like health and education has crashed to an 18-year low.
Already a subscriber?Productivity in the public service and government-funded industries has crashed to an 18-year low, and economists warn that pouring more taxpayer money into things such as disability and aged care will only serve to drag down living standards further across the board.
But economists question whether all the jobs created were necessary and productive, or whether the extra government spending they represent is making it harder for the Reserve Bank of Australia to quell high inflation.
Dr Chalmers on Sunday conceded it was difficult to eke out productivity gains in the care sector, which he said was becoming a larger share of the economy and was receiving billions in federal government investment. “Those things don’t really exist in large parts of the non-market sector. Hence it can dilute some of the incentive to be vigorously adopting new technology or new business models,” Mr Brennan said.
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