Australia faces labour shortages that are \u201conly going to get worse\u201d as large government spending squeezes the private sector, a leading economist has warned.<\/p>\n
Independent economist Warren Hogan joined Sky News Business Now on Monday where he weighed in on why many businesses are wary about building new projects in Australia.<\/p>\n
\u201cBusinesses will not expand, they will not invest if they don’t think they can find the staff,\u201d he said on Monday.<\/p>\n
Mr Hogan pointed to large government spending and the strain it has put on the private sector\u2019s access to labour.<\/p>\n
\u201cThe other issue is the government is madly out there expanding its footprint through funding of the care economy and this range of initiatives,\u201d he said.<\/p>\n
\u201cThat expenditure is labour intensive and it’s competing with the rest of the private sector for those scarce labour resources.<\/p>\n
\u201cWe have a demographic shift that leaves us with a shortage of labour and it is only going to get worse and the government, in response, is expanding its demand for labour, its size in the economy (and) squeezing the private sectors.<\/p>\n
\u201cSo, it’s not just construction, it’s happening everywhere.\u201d<\/p>\n
He went on to argue that large public spending was \u201cdragging down\u201d productivity as the private sector has mostly stalled in recent years.<\/p>\n
\u201cThe (non-market) sector productivity level right now is the same as it was in 2005,\u201d Mr Hogan said.<\/p>\n
\u201cThat is no productivity in 20 years whereas the private sector \u2026 is up about 30 percent and up 70 percent since 1994.<\/p>\n
\u201cWe are growing the least productive part of our economy, and we are hampering the most productive part.\u201d<\/p>\n
More than half of Australian voters rely on government for most of their income – through wages, benefits or subsidies – according to research by the Centre for Independent Studies.<\/p>\n
In a paper published in July, CIS economist Robert Carling warned that federal spending alone has reached 27.6 per cent of GDP.<\/p>\n
This was up from 24-25 per cent of GDP in 2012-13 and has been fuelled by a \u201cprogram expansion in social services, defence and debt interest\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":"Australia faces labour shortages that are \u201conly going to get worse\u201d as large government spending squeezes the private…\n","protected":false},"author":2,"featured_media":129420,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164,20309,13468,90106,90107],"class_list":{"0":"post-129419","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-economy","12":"tag-government-spending","13":"tag-labour","14":"tag-labour-shortages","15":"tag-warren-hogan"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/129419","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=129419"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/129419\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/129420"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=129419"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=129419"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=129419"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}