Analysis from the OECD, published in The AFR, shows that Australia ranks second-last among wealthy nations in terms of productivity growth since the COVID-19 pandemic.
EY’s chief economist, Cherelle Murphy, says the decline is partly attributable to “capital shallowing”—the fact that local companies are not investing enough capital in new equipment to match the growth in their workforce.
“We’ve had strong labour market performance, but at the same time, we have not had particularly strong business investment or innovation”, she said.
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