Australia is caught in a low-productivity trap

Tuesday 22 July 2025

As shown by the following chart from Justin Fabo from Antipodean Macro, Australia’s recent productivity growth has been among the worst in the advanced world.

Australia’s labour productivity (GDP per hour worked) has experienced virtually zero growth since 2016.

Reasons for the productivity decline:

I attribute Australia’s poor productivity performance to four main factors.

1) Deindustrialisation

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About the author

Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.