Productivity Primer

Main trends in Australia's productivity performance

Official Australian Bureau of Statistics measures of Australia's productivity performance are available from the mid-1960s. These show that there have been three phases of productivity growth:

relatively rapid productivity growth in the 1960s through to the mid-1970s, corresponding to the tail end of Australia's rapid development phase after the Second World War;
very slow productivity growth from the mid-1970s to the end of the 1980s; and
a return to more rapid productivity growth in the 1990s, accelerating to a record underlying rate from the mid-1990s (labour productivity growth of 3.1 per cent a year and multifactor productivity growth of 1.7 per cent a year from 1993-94 to 1999-00).

Figure 1: Australia's productivity growth (Percentage average annual rate of growth)

Graph of Australia's productivity growth

Australia's productivity performance compared with other high-income countries was relatively poor over a number of decades, up until the 1990s. However, Australia was only one of a few high-income countries to show an acceleration in productivity growth in the 1990s.