Worker wages are trailing efficiency improvements but mainly in mining and agriculture, a study by Australia's independent productivity body has found.
Research by the Productivity Commission found workers in all other industries - which make up the majority of the Australian workforce - were also missing out on some of the shares of productivity improvements but to a much smaller extent.
Firms become more productive by making it possible for workers to do more with less. This is done by investing in things like technology that can automate tasks, or by training workers to do their jobs more efficiently.
By squeezing more out of a given set of resources, more money can be made.
Unions and other groups have raised concerns workers have not been enjoying a fair share of productivity gains over the past decade and that too much of this income ends up on company balance sheets.
The deep dive by the commission found labour productivity was outpacing wage growth, but mainly in mining and agriculture sectors exposed to volatile international prices.
These sectors employ a small proportion of Australians, about five per cent. In the sectors employing the other 95 per cent of people, the gap between productivity growth and wages observed by the commission was "much smaller".
The commission estimates the share of income going to that 95 per cent of workers has declined by less than one percentage point since 1995.
But workers in those other industries were still missing out. They would still be taking home about $3000 more, on average, had wages been keeping pace with productivity improvements.
But the commission said kickstarting productivity growth would be much more effective at driving wage growth and overall prosperity than bridging the wage-labour productivity gap.
If productivity growth had stayed at levels in the 1990s - 2.2 per cent - by now workers would be taking home an extra $25,000 a year.
"In other words, the impact of boosting productivity far outweighs the impact of bridging the observed productivity wage gap," the report states.
"And importantly, productivity remains the key to continued wage growth and long-term prosperity."
Australian Associated Press
