How revamping education will boost the Australian economy

The kids groan, the parents silently rejoice. The start of the new school year is coming into view.  

But this should be a moment for reflection on what the 40-odd weeks of schooling will bring, and whether the time, money and effort that goes into the classroom is as well-spent as it possibly can be for students and for teachers. 

What’s going on in schools might seem far removed from the doldrums the broader Australian economy finds itself in, with low productivity growth contributing to falling living standards at a time of stubbornly high inflation. 

But the truth is, productivity and education are closely linked. Any teacher struggling with too much work and too little time knows, working smarter to achieve better results is a core part of the job.  

First, let’s look at the education system’s productivity: the relationship between what we’re putting in and what we’re getting out in terms of students’ results.  

Here, we’re trending in the wrong direction. For many years, taxpayers have forked out increasing sums for schools as a result of the so-called ‘Gonski’ plan. 2026 and beyond will bring yet more funding as part of the national funding deal struck last year by Education Minister Jason Clare.  

This deal differs from previous efforts in one important way, which is that it contains targets that seek to measurably improve student learning. Action towards these targets is sorely needed.  

Around one in three Australian students fails to meet proficiency standards in NAPLAN. This is closer to one in two for regional and remote students. For First Nations students or those whose parents didn’t finish high school, only one in three do meet proficiency.  

Today’s 15-year-old Australian students have gone backwards in learning compared to their peers from a generation ago, a decline sharper than that experienced in almost any other country, according to the OECD’s PISA testing.  

Second, there’s the contribution that education makes to the nation’s overall productivity. OECD research has shown approximately one-sixth of the slowdown in productivity across developed economies is attributable to a decline in human capital quality. National and international testing results tell us Australia is no different. 

This has observable consequences in the Australian economy. As students look toward life after school, lacking foundational skills constrains their future options in ways many will struggle to fully grasp. Employers are the other side of this coin, with consequences for the economy overall.  

Eighty-eight per cent of businesses report poor literacy and numeracy skills among workers, inevitably undermining productivity.  

But the solution starts in the classroom. The most effective way to fix our education and productivity slump is to ensure that all students are learning more each year through higher-quality teaching and better curriculum resources.  

Policymakers must relentlessly focus on policy reforms that will most help students learn more. Many such reforms are in train, but will require political courage to implement fully.  

First, the targets in the new agreement are important, committing governments to lift the overall percentage of students who are proficient in literacy and numeracy as measured by NAPLAN, and halving the learning gaps for disadvantaged groups, by 2031. 

But true targets are not just aspirational statements; they have accountability to match.  

Performance must be tracked transparently, publicly reported, and directly linked to decisions about what happens with future funding.  

In other words, there must be some sense of what will happen if states and territories fail to use the additional funds to measurably improve results.   

Second, the government must finish the job on teacher training and teaching practice. Clare did well in his first term to initiate new content requirements for teaching degrees through the ‘Strong Beginnings’ review. 

The review stipulates additional practical experience during training as well as reforms that require new teachers learn about the science of learning that underpins great teaching.  

In theory, universities that fail to reform their offerings accordingly would be disqualified from providing teacher education.  

The hard part is not defining new standards, but enforcing them. If ensuring university providers meet the new standards is too difficult, allowing more non-university providers to do the job instead — as has been done with great success in England — must be on the table.  

Third, federal agencies must seize the opportunities created by proposed reforms in other areas of the education landscape.  

The Australian Professional Standards for Teachers (APST) must be rewritten to reflect the same view of the science of learning and effective teaching that has underpinned the Strong Beginnings reforms.  

Currently, the APST fail to articulate the specific knowledge and practices required to be an effective teacher, and do not enable an evidence-informed way to differentiate between teachers of different skill levels.  

Finally, Clare’s announcement of ‘keyhole surgery’ on the maths curriculum for the first three school years is welcome, but much will depend on how the review process functions.  

This should draw on international examples and the hierarchical nature of maths to specify what students need to master by the time they move into middle primary.   

Critically, this should be informed by what evidence shows about number sense and fluency: fluency in maths facts and number knowledge must be deliberately targeted and sequentially built in to the curriculum.  

A clear written curriculum provides teachers the guidance they need to give students strong foundations for future learning.  

Education is too often treated as an important social policy issue that’s nevertheless separate from the engines of economic growth. That’s false.  

Australia’s prosperity and that of future generations of Australians rests on getting education right in 2026.  

Trisha Jha is a Research Fellow in the Education program at the Centre for Independent Studies and a former high school teacher.