On 29 September, the RBA raised the cash rate by 25 basis points, or 0.25 percentage points, to 4.60 per cent. Put simply, the RBA believes spending in the economy is still putting too much pressure on prices. Higher overseas costs, including fuel, are adding to the problem.

For local businesses with loans, higher interest rates can mean larger repayments and less room in the budget. RBA Governor Michele Bullock has also warned that weak productivity limits how much the economy can grow without generating high inflation.

Local businesses cannot control the cash rate, world oil prices or government tax settings. They can control how work gets done. Improving productivity means creating more value from the same hours, people and equipment. It will not remove the cost of a rate rise, but it can help a business absorb some of the pressure, protect margins and create capacity.

In practical terms, better productivity can mean:

  • a quote that takes 20 minutes instead of an hour
  • job information reaching the right person before they leave the depot
  • a new employee following a clear process without asking the same questions each week
  • an invoice going out promptly once the work is complete.

These are practical improvements that give a business more capacity from what it already has. They also allow work to move from one step to the next without someone constantly following up to keep it moving.

What productivity actually means

Productivity measures the output produced from a given amount of input. At the national level, one common measure is GDP per hour worked. It asks how much economic value Australia produces for each hour of labour.

GDP, or gross domestic product, is the total value of goods and services produced in the economy. The important word is value. Economists avoid simply adding up every sale because that would count the same inputs more than once. Instead, they look at value added.

Consider a local manufacturer that buys $40,000 of materials and sells the finished products for $70,000. Its value added is $30,000. That amount reflects the work, know-how, equipment and organisation the business has applied to the purchased materials. Across the economy, value added by businesses and other producers forms the basis of GDP.

What Australia's productivity figures tell us

Australia's economy grew in the June quarter 2026, but hours worked grew at the same quarterly rate. The Australian Bureau of Statistics reported that real GDP increased by 0.4 per cent in the quarter and 2.1 per cent over the year. Hours worked also rose by 0.4 per cent in the quarter and by 2.4 per cent over the year.

As a result, GDP per hour worked was flat in the quarter, after rounding, and 0.2 per cent lower than a year earlier. In the market sector, gross value added per hour worked rose by 0.2 per cent in the quarter but remained 0.1 per cent lower over the year.

These national figures do not tell us the productivity rate of Albury-Wodonga, let alone that of an individual business. The Border economy has its own industry mix and conditions. The data does show why waiting for a broad economic lift is not much of a business plan. Capacity improvements need to be found close to the work.

Start with the work as it is really done

Most productivity problems do not arrive with that label. They appear as interruptions, duplicated entry, unclear handovers or information stored in one person's head. Staff become busy managing the gaps.

The first useful step is to follow one piece of work from request to completion. For example, trace a customer enquiry through quoting, scheduling, delivery, invoicing and follow-up. Record each handover, each wait and each time information is entered again.

This often reveals a few small constraints doing most of the damage. A quote cannot be completed until one experienced employee answers a technical question. The scheduler works from a spreadsheet that the field team cannot see. Job notes arrive as text messages, photographs and handwritten sheets. Invoices are delayed because completion is not recorded in a consistent way.

The answer may be a clearer workflow or a standard job form. It may be a better rule about who decides what. Technology may help, but only after the problem is understood.

Use technology where it removes real work

There is no shortage of software promising to transform a small business. Buying another system is not, by itself, a productivity improvement.

Useful technology removes a known constraint. It might capture customer details once and carry them through to a quote. It could give staff a shared view of upcoming work or turn a completed job record into an invoice prompt.

The test is practical:

  • Does it shorten a wait or prevent rework?
  • Can staff use it reliably?
  • Will it fit the systems already in place?

Artificial intelligence should face the same test. It can help with first drafts or routine administration, but its output can still be inaccurate or incomplete. The time needed to check its work should be included when deciding whether it saves time. Trial it on a low-risk task and measure the result before expanding its use.

Management practice turns improvements into capacity

Workflows and tools only hold together when expectations are clear. In a small business, management practice is often informal because people know each other and problems can be solved quickly. That flexibility is valuable. It can also hide recurring issues.

Simple management routines can help:

  • keep priorities visible
  • give each task a clear owner
  • regularly check what is holding work up
  • make sure everyone knows which decisions they can make and which need approval.

Any change to a process should have one or two simple measures so you can tell whether it helped. For a quoting change, that might be turnaround time and the number of errors. If quotes are prepared faster but errors increase, the process still needs work.

Skills need to be connected to the work

Training is most useful when tied to a real process. A general software course may introduce features, but it will not necessarily change how a team handles an enquiry on Monday morning.

Start with the task. Identify where knowledge is missing or only one person can do the work. Build a simple guide, then let someone else perform the task and improve the instructions.

This approach also reduces key-person risk. The aim is not to turn every job into a rigid script. It is to make essential knowledge available, while leaving room for judgement where judgement adds value.

A local productivity improvement should be visible

For an Albury-Wodonga business, a useful productivity project has a clear starting point and a result that can be checked. It may release five hours a week from administration or reduce quote turnaround without lowering service quality.

Some gains will support growth. Others will make the working week more manageable, reduce the risk of relying on one person, or remove the frustration of repeatedly chasing a job through a process. All are legitimate improvements in productive capacity.

The place to begin is not with a large transformation program. Choose one workflow that matters, measure how it performs now and identify the main source of waiting, duplication or rework. Make one practical change, then measure it again.