Productivity isn’t just a number - it’s a reflection of who we are

Article by Stacey Shortall

When I first heard that MBIE and MFAT were inviting feedback on a draft long-term insights briefing into New Zealand’s productivity, I almost let it pass me by. “Productivity” is one of those words that can make some eyes glaze over. A term that seems to belong to economists and policy papers, not to everyday life.

Have Your Say: New Zealand's Productivity in a Changing World

But the truth is, productivity quietly underpins almost everything we value. It shapes whether our pay rises faster than prices, whether our hospitals and schools can keep up, whether our children will inherit a country that offers opportunity rather than scarcity. It’s not just an economic concept. It’s a social one.

For decades, New Zealand’s productivity has lagged behind comparable countries. We work long hours, yet we produce less per hour than many of our peers. The usual explanations appear in every report: low capital investment, small domestic market, distance from global supply chains. All true. But perhaps our challenge is less about distance and more about direction.

I’ve spent much of my career in the legal and regulatory space, and I’ve seen firsthand how the quality of our rules can make or break performance. Well-designed regulation gives certainty. It builds trust. It creates the foundation that businesses, workers and investors need to make long-term decisions. Poorly designed or constantly shifting regulation does the opposite. It breeds confusion, increases costs and erodes confidence. When rules change faster than people can adapt - or are applied inconsistently - risk aversion sets in and innovation stalls.

So while it might sound counterintuitive, strong and stable regulation is not an obstacle to productivity. It’s a precondition for it. Rules that are transparent, fair and enforced consistently create the conditions for creativity and investment to flourish. When a business knows what the playing field looks like, it can focus its energy on improvement rather than second-guessing which way the wind is blowing.

We also need to remember that productivity is not just mechanical - inputs and outputs, labour and capital. At its heart, it is about people. It’s about whether workers feel supported, safe and motivated to contribute their best; whether communities have the skills and infrastructure to participate fully in the economy; whether children arrive at school ready to learn, and whether parents can balance earning with caring.

That’s why the work I’ve done through the Who Did You Help Today charitable trust matters just as much as any policy lever. When volunteers read with children in Homework Clubs or record stories for the Storybook Project, they’re not boosting GDP but they are building the human capability on which future productivity depends. An economy that values people as costs to be minimised will always underperform one that treats people as contributors to be developed. We lift national productivity when we lift individual potential, especially in communities that have long been left out of the opportunity cycle.

Providing feedback on the long-term insights briefing offers a rare opportunity to think beyond the next election cycle. Too often even “long-term” planning gets squeezed into short-term political narratives. We debate this year’s growth rate or next quarter’s inflation, but real productivity change happens over decades. It’s built through education, infrastructure, innovation and inclusion. Through systems that let people thrive, from childcare to transport, digital connectivity to housing security.

All this means resisting the temptation to see productivity as a technocratic exercise. It’s not about lifting numbers on a chart; it’s about aligning the whole system - business, government and community - around a shared vision of prosperity that lasts. 

But we also need to be honest about trade-offs. True productivity isn’t achieved by cutting corners or cutting people. It’s about smarter design, better use of technology and stronger collaboration. It’s about doing what works for the long term, not just what looks good in next year’s Budget.

Every one of us has a stake in this, and has a voice to share in providing feedback on the draft long-term insights briefing into New Zealand’s productivity. Whether you run a business, teach in a classroom, serve in local government or volunteer in your community, productivity touches your world. We all know what it feels like to be stretched too thin, to keep working harder while wondering if anything’s actually improving. The same is true of our country. We can’t keep stretching; we have to start redesigning.

So yes, productivity might sound abstract, but it’s really about the kind of nation we want to build. I believe that is one that values fairness as much as efficiency, invests in its people, and trusts its institutions. One that measures success not just by what we produce, but by how we live.

In the end, productivity may start in spreadsheets, but it ends in people’s lives. The question isn’t just how to make New Zealand produce more. It’s how to make it fairer, smarter and stronger. And that, surely, is a goal worth every New Zealander’s attention.