We have the resources. We have the brains. So we should be much better placed than 86th in the world for economic complexity.

Australia has enjoyed a “lazy economy” for many years, an economy funded mostly by mining and agriculture and more recently by education and tourism.

Dig stuff up, grow stuff and sell it. 

Invite folk in from overseas – educate them and/or show them around. 

Commodity thinking. Easy and lazy. The “lucky country”.

No long-term strategic thinking. No investment in Australia’s future – in our productive industries – the industries that can generate long-term wealth, innovation and jobs.

We ship commodities out the door and buy them back again later as manufactured products and services. At a high price.

How dumb is that?

We got almost ten years of “Business as Usual” thinking from the last government. And business as usual in the 1950’s sense. Sheep’s back. Dirt, meat and wheat.

Which might be fine if the world remained the same. 

But the world has changed. Digital revolution. China. COVID. Conflicts. Climate change. 

And finally, government change from LNP to Labor.

At long last, we can now think and act strategically, with an eye on all the new challenges. 

And manage and grow a “productive economy”. 

Through our productive industries – agriculture, defence, education, energy, ICT, manufacturing, medical and health, space, mining and robotics – delivered through increased investment in R&D, and better use of technology. 

Delivered through vision, decision, direction, support and encouragement. 

To eliminate another problem.

Australia ranks 86 in the world for economic complexity. This index measures how well we are doing with the things we make. 

Japan is at the top, up there with China, Switzerland, Germany Korea, Singapore and so on. 

Australia is way down the bottom next to Kazakhstan, Mauritius, Oman and Guatemala.

Down with the dumb and the dumber. 

The previous federal government which claimed great economic management and strategic skills got us there. The LNP were not the great economic leaders as they claimed. They did little or nothing over almost a decade.

We now have to use our resources – dirt and brains - to generate long term wealth as we can do and should do.

There are a few issues we have to deal with.

Of our 19 industry sectors, 9 are not largely productive industries. They don’t produce a product or service that can be sold to generate wealth for the country.

They are service and support industries. 

And even if everybody in those industries worked their butts off, it would not do anything to generate wealth for Australia.

We need to generate wealth from our productive industries. 

And we can. 

Mining is an interesting case in point. It sells ore to the world, but in the process has generated new industries in robotics, automation, AI, space, defence, energy and even agribusiness. 

Largely self-funded. 

Look at the example of Andrew Forrest, using the profits of mining to generate new productive industries here in Australia.

And thinking about how to spend his money for greater good, generating jobs, mitigating climate impacts and building future industries. 

Joined up thinking.

Australia ranks 86 for economic complexity. The things we make and sell (export) are important to the economy. They are important to the provision of high reward jobs.

Our productive industries – the industries that produce goods and services that can be sold, generate wealth and provide valuable high paying jobs – are manufacturing, education, agriculture, arts & recreation, mining, professional services, medtech and media and communications – which includes ICT.

These industries rely on the skills generated in our schools, universities and CSIRO. 

Australia could be an engine room of innovation, up there with Japan, China, Switzerland, Germany Korea, Singapore and so on, not languishing near the bottom next to Kazakhstan, Mauritius, Oman and Guatemala.

And we only rank 23rd on the Global Innovation Index. 

We should be much higher up the ranking.

We have the brains. We have the industries. We have the businesses. And with the new government, we now have the vision and mechanism to connect these businesses to investment. 

And to connect these businesses to our universities and CSIRO. 

We don’t need to keep importing skills from overseas – the lazy option. We need to generate those skills in our schools, TAFEs and universities.

We need to align our high schools and universities with productive industry needs. Parents have to understand that the world has changed.

It’s not about getting people to work harder. They need to work smarter. And improvements in productivity are now largely delivered through automation, software, robotics and AI.

The digital revolution has delivered the business improvements.  And central banks, treasuries and economists are still struggling to include those impacts of technology into their 1950’s view of productivity.

In agriculture, farmers are highly productive. Productivity has increased because of machinery, better genetics in crops and animals, and the use of farm management systems. Automation and robotics are improving productivity even further.

In manufacturing, automation and business management systems have made factories more productive. Many larger factories are nearly fully automated.

Technology is delivering the increased productivity, not just workers.

Mining is highly productive with automation, robotics and software increasing productivity every year. Productive technology and workers.

In education, productivity has been increased by software (learning management systems and videoconferencing), but at a cost to quality. The automation of education has commoditised education. Whether that is good or bad remains to be seen.

Media and communications are driven by technology improvements, with software commoditising the creation of graphics, video, images and their management, with huge improvements in productivity.

Innovation in all these productive industries is where our future should be built.

In energy, waste management, pollution control, water, automation and robotics, arts and crafts, fashion, manufacturing, ICT, education, space, mining services, defence, assistive technology and ag-tech.

These are industries that will help us manage climate change. These are the industries that will deliver high reward jobs and employment opportunities for our kids and grandkids. These are the industries that will provide products and services that can be exported to the world.

Productivity can be improved by technology. And this will continue to happen. 

But thinking can only be stimulated in an education system that recognises the importance of imagination matched to technology. 

Science, technology, engineering, arts and mathematics. 

STEAM not STEM

We have to innovate. 

And we only rank 23rd on the Global Innovation Index. 

We should be much higher up the ranking.

And we need to apply that innovative thinking to increase our economic complexity.

Because we only rank 86 for economic complexity. 

The things we make and sell (export) are important to the economy. They are important to the provision of high reward jobs.

Improving productivity will be managed by proper use of technology.

Improving economic complexity can be managed by investment in the productive industries that are the foundation of our future.

And we can start building that future right now. 

It just requires vision, direction and action.

And finally, with the new government we can begin building that future…now.