{
  "id": 4486354,
  "title": "As rising inequality demands reform, business is 'circling the wagons'",
  "url": "https://urgent.news/2026/08/30/as-rising-inequality-demands-reform-business-is-circling-the-wagons",
  "topic": "business",
  "section": "Business",
  "published": "2026-08-30T19:01:33.000Z",
  "source": {
    "name": "ABC News AU",
    "slug": "abc-news-au",
    "url": "https://www.abc.net.au/news/2026-08-31/declining-productivity-bca-unions-ai-future/107095052"
  },
  "original_language": "en",
  "account": "At a recent Business Council of Australia annual dinner, there was a consensus that Australia's productivity needed improvement. Prime Minister Anthony Albanese emphasized the importance of a partnership between government, business, and the community to keep the economy strong. Geoff Culbert, BCA president, called for government and business collaboration to explain the need for change. Bran Black, BCA chief executive, listed ministers he had worked with and discussed how government and business could work together to make Australia an attractive investment destination.\n\nHowever, the event's atmosphere was somewhat contrasting. Despite the positive talk, the period of high productivity growth in the 1980s and early 1990s was characterized by labor and the government working together, not business and the government. During this time, productivity grew by more than 2 percent per year, while the current decade's average was 0.3 percent, and productivity dropped by 0.7 percent in 2024-25.\n\nNotably, the Business Council of Australia was formed during this period to oppose reform. Meanwhile, the partnership that drove productivity growth was between the Labor government and the ACTU, specifically Treasurer Paul Keating and ACTU Secretary Bill Kelty. They aimed to fix the economic system by opening it up, addressing unsustainable wage growth, high top marginal tax rates, and high inflation. In 1991, Keating legislated 12 percent superannuation and reduced the commission, leading to the end of centralized wages and industry protection.\n\nFast forward to the present day, and there's a noticeable shift in attitudes. A New York-based Australian banker, who lived through the 80s and 90s reform era, believes that the current policy mindset is defensive, with the nation circling the wagons. The ACTU has become a shadow of its former self and now participates in the national discussion from the sidelines, rather than the field of play. The main players in national policy are now lobbyists, representing businesses and their organizations, who benefit financially from the current system.\n\nA significant factor in the decline of union influence is the drop in union membership from around 60 percent to around 10 percent. Additionally, the CFMEU's corruption has damaged the labor movement's credibility. The decline in real wages has led businesses to oppose wage increases, contributing to the slump in productivity growth. Per capita household income has been negative for years after inflation, meaning that financial struggles do not foster productivity. Instead, declining productivity growth coincides with a fall in business investment growth and a shift in the profit share of the economy.",
  "summary": "Business used the collapse of unions to suppress wages and oligopoly power to increase prices. Expecting it now — using AI — to fix declining productivity, rising inequality, generational anger and political polarisation is fanciful.",
  "key_points": [
    "Australia's productivity needs improvement, according to Business Council of Australia",
    "Government and business collaboration called for to boost economy",
    "Shift in attitudes: nation circling the wagons, with lobbyists leading policy"
  ],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}