Australia’s Declining Education Standards are Threatening Jobs, Wages, and Innovation, says BCA

The BCA says addressing the skills gap is key to boosting productivity and increasing real wages and living standards, and to that end Australia must set new education targets for reading, science and maths, with the goal of returning to the top 10 in OECD rankings for each area.

OECD data shows that Australia’s education standards have fallen since 2006:

• Reading: 6th (2006) down to 12th (2022)
• Science: 6th (2006) down to 10th (2022)
• Maths: 8th (2006) down to 16th (2022)

Business Council Chief Executive Bran Black said it is a major concern for Australia’s future economic prosperity and jobs pipeline if basic education standards are not improved.

“The BCA is calling for new education targets to be set with the goal of returning student results back to the OECD top 10 rankings for each of reading, science and maths,” Mr Black said.

“We can’t be a leader in AI, digital skills and a developer of new technologies in advanced manufacturing if we’re not equipping our students with the basic skills and education required to take on those jobs.”

Mr Black said a key BCA recommendation to improve education standards is increased phonics screening and, where necessary, early intervention for students in primary school.

“We strongly support the Year 1 phonics screening test, and we think a greater focus on early primary school intervention and support for students who have been identified as needing help is essential.”

Mr Black said Year 12 retention rates were also a concern, with current data showing only 79 percent of students stay on to year 12 — the lowest rate in 12 years (2011–2023).

“The Federal Government’s recently announced Better and Fairer Schools Agreements will help keep kids in school, with their strong focus on evidenced based teaching, as it’s clear we need a back-to-basics approach to reading, science and maths to give kids the confidence to go the distance with their studies.”

The BCA is also calling for careers counsellors, working to a national standard, to be placed in every secondary school to give students up-to-date advice on the full range of opportunities available to them, especially for jobs of the future and sectors facing skills shortages.

“Every student should have access to a careers counsellor, and advice must be modernised, standardised and accessible to help students identify future job opportunities and equip them with knowledge about the skills they might need to have the best shot at success,” Mr Black said.

Why This Matters for Business and the Economy

The Business Council of Australia (BCA) has raised a critical issue that directly impacts both the future of Australian businesses and the national economy: the need to address Australia’s declining education standards and the growing skills gap. As the global economy becomes increasingly digital, competitive, and reliant on technological innovation, the country’s ability to foster a highly skilled workforce is essential.

The skills gap is already hindering productivity, wage growth, and overall economic advancement. Without significant improvements in education, particularly in foundational subjects like reading, science, and maths, Australia risks falling behind in key areas such as AI development, digital technology, and advanced manufacturing. The BCA has emphasized that, to remain competitive, the nation must not only invest in cutting-edge technology but also ensure that future generations are equipped with the basic skills required to thrive in these fields.

The call for action to place careers counsellors in every school is particularly relevant, as it ensures that students are better informed about the opportunities ahead of them—especially in sectors experiencing rapid growth and facing acute skills shortages. By addressing the skills gap now, Australia can cultivate a workforce that is prepared to meet the challenges of tomorrow, boosting innovation, productivity, and ultimately, economic prosperity.

With the economy’s future at stake, the BCA’s call for improved education standards and support systems is more than just an educational issue—it’s an economic imperative. A highly skilled workforce is the foundation of a thriving economy, and without a strategic focus on education, Australia may struggle to meet its long-term economic goals.