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In 2020, all Australian governments, along with the Coalition of Aboriginal and Torres Strait Islander Peak Organisations, signed the National Agreement on Closing the Gap (the Agreement). They committed to mobilising all avenues available to them to achieve the objective of the Agreement - which is to overcome the entrenched inequality faced by too many Aboriginal and Torres Strait Islander people so that their life outcomes are equal to those of all Australians.

The Agreement is built around four Priority Reform outcomes and 17 socioeconomic targets, and the parties to the Agreement also agreed that the Productivity Commission (the Commission) would undertake a comprehensive review of progress every three years. This is the first review to inform the ongoing implementation of the Agreement. The scope of the review covered: (1) analyse progress on Closing the Gap against the four Priority Reform outcome areas in the Agreement; (2) analyse progress against all of the socioeconomic outcome areas in the Agreement; and (3) examine the factors affecting progress.

The report sets out the Commission's findings and recommendations on the ongoing implementation of the National Agreement on Closing the Gap by highlighting areas of improvement and emphasising where additional effort is required to close the gap. The key messages are: there is some evidence that governments demonstrate ability and willingness to partner in shared decision-making but change is not occurring; accountability is limited; and progress is falling short of envisaged expectations.

Edited excerpts from publication and publisher's website. Show less

Literacy and numeracy skills are key components of human capital, which is an important driver of economic growth. This paper utilises data from a 2006 survey on the literacy and numeracy skills of the Australian adult population. Analysis reveals that literacy and numeracy skills: for nearly half of the population were assessed at either levels 1 (the lowest level) or 2, both of which are below the minimum level deemed necessary to participate in a knowledge-based economy (level 3); vary according to a number of factors, and were generally highest for people who had either undertaken higher levels of education, were born in an English speaking country or were of prime working age (20-44 years old). Models were used to estimate the effect of improved literacy and numeracy skills on the probability of labour force participation and on wages. Results confirm previous research in the human capital literature, that improving literacy and numeracy skills has a positive, statistically significant effect on labour market outcomes. More specifically, it was estimated that an improvement in literacy and numeracy skills from level 1 to level 3 would: increase the likelihood of labour force participation by about 15 percentage points for women and about five percentage points for men; and increase hourly wage rates by about 25 and 30 per cent for women and men respectively. Improving educational attainment was also estimated to have a positive, statistically significant effect on labour force participation and on wages. However, once literacy and numeracy skills were controlled for, the effect of increasing educational attainment on labour force participation and on wages was reduced. Some of the benefit occurs because more highly educated people tend to have higher literacy and numeracy skills. Literacy and numeracy skills are developed through education, but they can also be enhanced in other ways. Understanding the factors that influence literacy and numeracy skills is important and could be further explored with the data used in this paper.

Published summary from Productivity Commission website. Show less

This paper aims to provide an overview of the changing role of part-time work in Australia and was released on 12 June 2008. The objectives of the paper are to: provide a comparison of part-time work in Australia and overseas, and possible reasons for our relatively high reliance on this form of work; present an assessment of the changing role of part-time work in Australia; identify groups (older workers, younger workers, prime age workers) that are availing themselves of part-time work; and [identify] industries that have higher proportions of part-time workers and how these have been changing over time.

Published abstract from Productivity Commission website. Copyright Commonwealth of Australia reproduced by permission. Show less

Education supports young people to realise their potential by providing the knowledge and skills they need to participate in the economy and in society, and by contributing to their wellbeing. The National School Reform Agreement (NSRA) is a joint agreement between the Commonwealth, states and territories to lift student outcomes across Australian schools. The objective of the NSRA is that Australian schooling provides a high quality and equitable education for all students. The NSRA sets out long-term national outcomes for school education in Australia and national targets and sub-outcomes to track progress. To achieve these outcomes, the NSRA sets out three reform directions which are supported by eight national policy initiatives as well as bilateral agreements specific to each state and territory. The Measurement Framework for Schooling in Australia, including the schedule of key performance measures, provides the basis for Australian education ministers to report to the community on the performance of schooling, in accordance with the Education Goals for Young Australians as expressed in the Alice Springs (Mparntwe) Education Declaration [available in VOCEDplus at TD/TNC 95.50].

This review of the Agreement will examine how well national policy initiatives by the Australian, State and Territory Governments have achieved the objectives and outcomes set out in the Agreement. In undertaking the review, the Productivity Commission will assess: the appropriateness of the National Measurement Framework for Schooling in Australia in measuring progress towards achieving the outcomes of the NSRA; and the effectiveness and appropriateness of the National Policy Initiatives outlined in Part 3 of the NSRA, recognising that national reform takes time to implement and mature, and for the effects of nationally coordinated reform efforts to materialise. In the context of the National Measurement Framework for Schooling in Australia, consideration should be given to current and planned measures and data projects, and their application, utility and relevance to NSRA outcomes.

This is an interim report prepared for further public consultation and input. The Commission will finalise its report after these processes have taken place.

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Geographic labour mobility is an important element of a well-functioning labour market. By improving matches between employers and workers, geographic labour mobility can contribute to economic efficiency and community wellbeing.

This is the report of the Productivity Commission's assessment of geographic labour mobility within Australia and its role in a well-functioning labour market. The terms of reference were to: (1) examine patterns and trends in geographic mobility (including by state/region, industry, occupation, skill level, form of employment and demographic characteristics), their relative contribution to regional labour supply, and the implications of structural, demographic and technological developments; (2) identify the key determinants and drivers of mobility, including the costs and benefits from the perspectives of businesses, individuals, their families and governments (indicating the composition of costs faced and potential benefits in a range of representative circumstances and regions), any differences in the determinants and drivers of mobility between groups (such as employed and unemployed people), and an assessment of the effectiveness of market signals, such as wages; (3) identify the major impediments to geographic mobility to support economic adjustment, employment and productivity outcomes; (4) assess the current strategies used by employers and governments that affect geographic mobility, and discuss possible options to enable further mobility; and (5) estimate the prospective economy-wide impacts of reducing impediments to geographic mobility.

[The] study has found that geographic labour mobility is helping the economy adjust to major structural change, and has enabled wealth to be spread across the country. However, the study also highlights some signs that the labour market is not adjusting efficiently in all cases and concludes that there is room for improvement.

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The [Coronavirus Disease 2019] COVID-19 pandemic has led to large-scale and rapid changes in work practices, including a dramatic increase in the number of people working from home. The pandemic has demonstrated that many jobs can be effectively done from home, and it appears likely that the number of people working from home will remain much higher than it was previously. The paper considers how decisions about location of work will be made as firms and workers continue to learn how to organise their work, and what an increase in working from home might mean for workplace regulation, urban centres and wellbeing more generally.

Excerpt from publisher's website. Show less

Australia has an ageing population, with the proportion of people aged 65 and over expected to more than double over the next few decades. This situation will affect Australia’s long term economic prospects. This draft research report responds to an Australian Government request for the Productivity Commission to examine the productivity, labour supply and fiscal implications of likely demographic trends over the next 40 years. The report has been prepared for further public consultation and input, and the Productivity Commission will submit its final report to the Treasurer and the Council of Australian Governments in March 2005. The study complements but updates and builds on the Australian Treasury’s Intergenerational Report published in 2002 (indexed at TD/TNC 69.85). A key distinguishing feature is that it includes detailed projections for the States and Territories. Key points from the report are that: population ageing will give rise to economic and fiscal impacts that pose significant policy challenges; as more people shift into older age groups, overall labour force participation rates are expected to drop; falling participation and average hours worked will slow Australia’s labour supply growth, in spite of a projected decline in unemployment rates; based on the average labour productivity performance of the past three decades, gross domestic product (GDP) growth per capita will drop to around half its present level by the mid 2020s although this could be improved with a sustained increase in productivity; the major source of budgetary pressure will be health care costs; fiscal gaps opened by ageing are mostly expected to fall on the Commonwealth government, but there are significant burdens on State and Territory governments; it will be important to improve productivity and achieve more cost-effective services provision, particularly in health care. Show less

The annual 'Report on government services' (RoGS) provides information on the equity, effectiveness and efficiency of government services in Australia. The report is presented in seven parts: Part A - Approach to performance reporting; Part B - Child care, education and training (includes early childhood education and care, school education, vocational education and training); Part C - Justice (includes police, courts and corrective services); Part D - Emergency management (includes fire and other emergency events);Part E - Health (includes primary and community health, ambulance services, public hospitals, services for mental health); Part F - Community services (includes aged care, disability, child protection and youth justice); Part G - Housing and homelessness. Data in the 2021 report may be impacted by Coronavirus Disease 2019 (COVID-19) and this has been noted in the report.

Part B, section 5, 'Vocational education and training', contains performance information for vocational education and training (VET) services. There are 11 indicators within the VET framework measuring access, appropriateness, quality, efficiency and outcomes. The indicators are: Barriers to participation in VET by target group; Barriers to participation in VET; Students who achieve main reason for training; Employer satisfaction with VET; Student satisfaction with quality of training; Service quality; Government recurrent expenditure per annual hour; Student employment and further study outcomes; Student completions and qualifications; Students who improved education status; and Skill utilisation.

Findings include: 82.1 per cent of government-funded 2018 VET graduates reported that training helped to fully or partly achieve their main reason for training, with similar results for Aboriginal and Torres Strait Islander government-funded graduates; for those employers engaged with VET, 69.2 per cent were satisfied with all forms of VET engagement, a decrease from 77.8 per cent in 2011; 88.6 per cent of all government-funded 2018 VET graduates indicated that they were satisfied with the overall quality of their training, with a higher proportion for Aboriginal and Torres Strait Islander government-funded graduates (91.6 per cent in 2019); 86.2 per cent of 20-64 year old total VET graduates from 2018 were employed and/or continued on to further study after training, with a higher proportion for people from remote and very remote areas (91.8 per cent) and lower for Aboriginal and Torres Strait Islander people (84.1 per cent) and people with disability (73.7 per cent); the number of qualification completions by total VET students declined 15.5 per cent from 2015 to 2019; of all total VET graduates aged 20–64 years that completed an Australian Qualifications Framework (AQF) qualification nationally in 2019, 46.1 per cent did so with a higher qualification than their previous highest AQF qualification, with a higher proportion for all three target groups - Aboriginal and Torres Strait Islander people (55.7 per cent), people from remote and very remote areas (48.3 per cent) and for people with disability (50.1 per cent); and in 2018-19, 79.8 per cent of persons aged 15–64 years that completed their highest VET qualification in the last five years, were either working in the field of that qualification or not working in same field and the qualification was relevant to their current job. This proportion is lower than 2015 (83.0 per cent), but similar to 2010-11 (79.9 per cent). Show less

The annual Report on Government Services (RoGS) provides information on the equity, effectiveness and efficiency of government services in Australia. The report is presented in seven parts: Part A - Approach to performance reporting; Part B - Child care, education and training; Part C - Justice; Part D - Emergency management; Part E - Health; Part F - Community services; and Part G - Housing and homelessness. Data in the 2023 report may be impacted by Coronavirus Disease 2019 (COVID-19) and this has been noted in the report.

Part B, section 5, 'Vocational education and training', contains performance information for vocational education and training (VET) services. There are 11 indicators within the VET framework measuring access, appropriateness, quality, efficiency and outcomes. The indicators are: Barriers to participation in VET by selected equity group; Barriers to participation in VET; Students who achieve main reason for training; Employer satisfaction with VET; Student satisfaction with quality of training; Service quality; Government recurrent expenditure per annual hour; Student employment and further study outcomes; Student completions and qualifications; Students who improved education status; and Skill utilisation.

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Major changes to the arrangements for active labour market assistance were announced by the Australian Commonwealth Government in its 1996-97 budget. As part of these reforms, the Commonwealth Employment Services (CES) was closed in 1998 and replaced by the Job Network. It was guided by three key principles: (1) to deliver a better quality of assistance to unemployed people which would lead to better and more sustainable employment; (2) to address flaws inherent in arrangements at the time by changing the role of the government from provider to purchaser; and (3) to use competition to increase efficiency and choice for consumers. At the time these reforms were announced, the Government stated that there would be a complete evaluation of the new arrangements, including an independent review of the Job Network’s policy framework. This independent review was undertaken by the Productivity Commission and this report presents its findings. It is structured as follows: the first section contains the terms of reference, key messages, an overview of the report and recommendations; chapter one provides the introduction which includes a snapshot of the Job Network 2002 and the scope of the inquiry; chapter two discusses the rationale for the provision of labour market assistance; chapter three looks at whether the purchaser-provider model is justified, comparing it to direct government provision and other delivery models; chapter four describes how the Job Network works; chapter five considers employment outcomes and costs of the Job Network; chapter six looks at how it affects the experiences of job seekers and employers; chapter seven assesses what services should be provided to job seekers by the Job Network; chapter eight examines the choices available to job seekers; chapter nine assesses the targeting arrangements; chapter 10 considers the pricing of services under the purchaser-provider arrangements; chapter 11 examines industry dynamics, i.e. entry, growth, exit and performance appraisal; chapter 12 analyses compliance and monitoring issues; chapter 13 deals with competitive neutrality issues; chapter 14 examines the roles of the players and coordination issues; and the final chapter examines the scope for applying the purchaser-provider model to other areas of Commonwealth service delivery focusing on the labour market and related social welfare areas.

The draft report, released in March 2002, is indexed at TD/TNC 69.196 and the government response to this document is indexed at TD/TNC 71.380. Show less