Competition to increase productivity is unwinnable
“Incomes and living standards will slow” because productivity growth in Australia is low, according to a recent story in the Sydney Morning Herald. If Australian productivity growth (i.e. output per unit of labour time) is measured against a global average, lower productivity growth also lowers the value of the Australian dollar. If a certain amount of labour produces a particular commodity, then “slow growth” in productivity means that there is little reduction in the necessary labour time to produce commodities. It makes sense that any decline in the value of the currency accounts for rising government debt when productivity doesn’t increase as fast as the average.
“The productivity slowdown has been put down to a number of factors, including the shift in the economy towards services and away from manufacturing…” This is because there is a limit, not just a barrier, on reducing labour time for services.
Andrew Leigh (Assistant Minister for Competition, Charities and Treasury) says the answer to slow productivity growth is “more competitive pressures across the economy”. This is exactly what people do NOT need. Competitive pressures drive increased work intensity, and downward pressure on wages and conditions.
“Clever” cannot be monopolised, as Leigh seems to advocate. At best being clever might temporarily put a competitor ahead on saving labour time, but the competition continues, noone is a permanent winner, and in any case, it’s irrational to organise the world so that there are always losers.
It’s true we need mechanisms for organising society and its resources, so that we can get improvements in services, infrastructure and goods to people who need them. But chasing productivity in a world awash with excess production and waste, is a losing battle driven primarily by capital’s insatiable pursuit of its own further enrichment. The criteria for better mechanisms than productivity growth is that they rest on democratically organised cooperation to solve problems, and satisfy people’s needs.
SMH: Lower productivity to leave Australians thousands of dollars worse off – https://www.smh.com.au/politics/federal/lower-productivity-to-leave-australians-thousands-of-dollars-worse-off-20221114-p5by0m.html
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