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Skills and Productivity

Labour productivity, or what we do or produce for every hour that we work, is an area of the New Zealand economy that needs immediate attention.

Our levels of labour productivity are low compared with many countries including our closest neighbour, Australia, and are improving at a particularly slow rate. This is a key reason why we are no longer one of the richest countries in the world. What’s more, we currently have much more work to go around than people to do it, which makes productivity a big issue.

Productivity isn't a measure of how hard we work. It’s a measure of how smart we work, or how much we get done. Smart workers are skilled workers but just having skills isn't enough. They have to be the right kinds of skills, and they have to be put to good use. Putting skills to good use means paying attention to a lot of things: motivation, working environment, rewards, plans, teams and many other factors.

A ‘stockpile' of skills will not, on its own, lift productivity. It’s also important to think of what skills are actually needed to increase productivity and smart ways to organise work.

As a small economy, New Zealand faces particular challenges when doing some things other countries often do to improve productivity, such as investing heavily in new technology. This is because the return for such investments may not be high enough in such a small market.

Industry training organisations work collaboratively with their industries and businesses to implement and monitor a variety of innovative training programmes for their employees. This puts them at the forefront of being smart - developing tailored schemes aimed at improving productivity.

Skills and Productivity Case studies

Lean Marine Thinking

Clelands Timber - Competitive Manufacturing

InfaTrain - Research into the Drivers of Productivity

All case studies are published in Skilling New Zealand: ITO Leadership in Action