Working less could be the answer to one of our biggest problems

Sydney Morning Herald

22-05-2025

Sure, a handful of individual geniuses helped bring these things to life, but a majority of workers are limited in their ability to do things more efficiently, often by the tools, rules and conditions they're forced to work with.
One suggestion made by the productivity boffins in their latest push (triggered by Treasurer Jim Chalmers' request for reform recommendations) in the economy-wide brainstorm on how to overcome the productivity road block, is shaking up the way companies are taxed.
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Specifically, the commission is looking at ways to prod businesses to invest more (something that has been lacking in Australia for quite a few years). Specifically, it will consider tax incentives for businesses to spend on things like better equipment, tools and technology – things which help workers to save time and produce more or better things without having to work harder.
A barista, for example, who doesn't have to share a machine with their colleague, may be able to serve more coffees, and an accountant with access to better software provided by their company may be able to slash the time it takes to crunch numbers for their clients.
Cutting the 30 per cent corporate tax rate (an option currently on the table according to Productivity Commission boss Danielle Wood), though, is probably not a good move unless there's a way to guarantee those big businesses won't just pocket the extra profit or pay it out to shareholders.
While big businesses might be keen for such changes, they probably don't provide bang for our buck, and they come at a cost to the government's budget.
It's probably also bad news if it gives big companies – which already dominate many sectors of the economy – more power, making it difficult for small and medium-sized businesses to challenge them and drive innovation.
However, tax breaks for new investment which, in theory, should encourage firms to invest, seem less effective in Australia compared with many other countries, according to the Reserve Bank.
While big businesses might be keen for such changes, they probably don't provide bang for our buck, and they come at a cost to the government's budget.
This makes it more difficult to achieve some of the commission's other reform priorities such as improving school student outcomes and upskilling the workforce. The better-educated we are, and the more we're able to build on our skills, the better we become at doing things.
Under-resourcing of schools has been a well-documented issue – and probably a key factor behind Australia's lagging performance academically. It's also something the government will struggle to improve if its budget is tight.
Cutting red tape is another area of reform being examined by the commission. This is a good thing – especially when it comes to the net-zero transformation. It's clear that climate change and the increased prevalence of natural disasters will hamper our ability to work. And without making it easier for Australian businesses to transition to cleaner energy, we'll be left behind in the global shift, and fail to act on a hugely promising area of growth.
Speeding up approvals for new energy infrastructure is a good example from the commission of how we can improve productivity. Instead of being bogged down by lengthy approval times, businesses can get on with investing in transformative projects aimed at harnessing some of our natural gifts: sunlight, wind, and other cleaner forms of energy.
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And while they are just lofty aims for now, other focus areas including supporting government investment in preventing health problems (rather than waiting to treat them after they arise) and improving our uptake of digital technologies, should make us more productive by ensuring a healthy workforce and helping us harness the power of developments such as artificial intelligence.
But these are all things we've known for some time.
It's also about bosses and government departments listening to the lesser – but consequential – suggestions made by their employees.
If you ask any worker what the most time-consuming and unnecessary parts of their job are, they'll almost always have an answer. Most teachers, for example, point to the growing and excessive administrative work they're required to do which reduces their ability to do what matters for students – and what will actually affect students' outcomes.
Yet, at company and department level, there's usually little to no engagement with employees about what they think could be done better – and even when there is, a dismal amount is actually done about it.
A key determinant of the Productivity Commission's success in improving productivity will be to compel top decision makers and bosses to act on all of these reform ideas. Paradoxically, legislating a shorter working week seems radical, but – as with the laws which brought in the eight-hour working day – could boost productivity.
There have been multiple studies showing shorter work hours improve workers' wellbeing, focus and efficiency. Having less time to get things done often pushes us to lock in and get more done in a shorter amount of time.
And if this isn't the case, shorter work hours will push bosses to implement the productivity-boosting changes required to support their workers to work more efficiently and improve productivity in the longer term.