Why we might keep getting participation wrong — like we have for 20 years

For 20 years, a key part of the intergenerational reports produced by governments of both persuasions has been badly wrong. And they’ve known it. Luckily, it’s proved a good kind of wrong. But examining why the best minds in the country have erred on a key policy issue might prove instructive.

Since the first one in 2002, the reports have focused on the three Ps — population, productivity and workforce participation. Treasury has got each of them wrong. The early reports badly underestimated population growth, our productivity performance fell into a hole because of WorkChoices and has never fully recovered (except for a burst under the Rudd-Gillard governments), and each report has been badly off-beam on the participation rate.