The Sydney Morning Herald and age contacted dozens of business leaders, most of whom refused to stick their heads out of the parapet to advocate for what they believe should be the priorities of the next federal government. In a federal election, CEOs, chairmen and women on boards and business groups typically avoid politics. As Nobel Prize-winning economist Milton Friedman said, “The business of business is business.”
A number of Australian companies even go so far as to make it a rule not to comment on election promises and policies during the campaign trail. Companies are cautious, knowing that showing partisan support for a party is a gamble, especially if that party doesn’t end up winning the job. Another reason is that companies do not want to alienate customers, staff or shareholders by entering the political fray, except on issues where there has been broad community support, such as same-sex marriage, climate change or wage growth.
Peter Shergold, who was the chief minister and chief of staff in the Howard government, also said the nation needed to increase migration in the short term. “Australia still depends for its economic growth and development on the large-scale recruitment of foreign labour. We need to think: what is the appropriate balance we need between permanent and temporary migration? And how can we do this in a way that is not perceived as a short circuit to invest as we should in our own education and professional training?”
Shergold says this is the first time in three generations that Australia has not had mass migration. He wants to see greater opportunity for temporary migrants to progress to become permanent residents, and also for the academic and TAFE sectors to integrate. While Australia needs more science graduates, Shergold says it also needs more people ready to work in aged care and childcare.
A tight labor market has pushed up wages, which have taken center stage in the federal election campaign alongside the cost of living and rising interest rates.
In the RBA’s May statement on monetary policy, it revealed that more than half of companies surveyed expected to pay wage increases of more than 3% in the coming year due to the labor market. tense work. Firms such as Woolworths have backed raising wages for retail workers in line with underlying inflation. The Australian Council of Trade Unions has called for a minimum wage increase of 5 per cent.
CommSec Chief Economist Craig James said without an upsurge in migration it would be difficult to fill vacancies and expects companies to either start working harder on existing employees or restructure to prioritize the work they can and cannot do. “If you’re paying 3.5% wage increases and you want 2.5% inflation, the difference between the two has to be productivity. Otherwise, companies will back down, they won’t get a return. They pay 3.5% growth on wages and get 2.5% on prices.
Shepherd says failure to fill jobs will lead to higher costs, in areas such as wages, and lower Australia’s competitiveness. Both political camps have promised to review migration levels.
The mounting wage pressures in Australia come after a decade of weak wage growth, where real wages have fallen. In the richest countries of the world, there is a trend of rising wages and rising prices of goods. This added to inflationary pressures in the global economy already caused by disruption of factory production and supply chains due to COVID-19 restrictions in countries like China, and a spike in prices. of oil triggered by Russia’s invasion of Ukraine.
Central banks around the world have raised interest rates in an effort to curb inflation, which could dampen business spending and investment. Still, some business leaders such as Macquarie Group Chief Executive Shemara Wikramanayake remain optimistic. She believes the economy will remain resilient despite the threat of higher interest rates and inflation, saying decarbonization and digitalization trends will boost business investment.
Diane Smith Gander, director of Australia’s biggest greenhouse gas emitter, AGL, also wants the next federal government to prioritize securing a unified national approach to decarbonising the economy, arguing that it There has already been a decade lost on federal public policy in this area.
“Everyone is on board with the science of climate change now, except for a small group, which you might describe as the lunatic fringe,” Smith-Gander says. “We need to find a way to move towards faster decarbonisation of the economy and support to ensure this is done in a fair and orderly way which maintains energy affordability for Australian households so that Australians continue to support the push towards decarbonisation. .”
AGL is the subject of a campaign by activist investors from billionaire Mike Cannon-Brookes, who opposes a plan to spin off the company, and has criticized its failure to move faster towards decarbonization.
Smith-Gander thinks whichever political camp wins on May 21 will have a strong mandate to act on decarbonizing the economy. CommSec Chief Economist Craig James agrees: “Any government that gets to ground zero, whether it’s the Labor government or the existing government, that’s the time when you can do things. . You must seize the opportunity early in your term and show leadership.
This is a view also shared by Shepherd. “It comes down to leadership and politics. The company is pragmatic. They will work with anyone.
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