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Comment by schappim | Hacker News Reader

Speaking as an Australian, our productivity has been lagging[1] compared to the US, largely due to the availability of cheap labour (attributed by economists to foreign students)[2].

I heard one economist on the ABC give the example of carwashes[2]. From the 1990s to the early 2000s, car washes in Australia were largely automated and hand-wash car washes were relatively uncommon. However, the abundance of cheap labour has since led to a proliferation of hand-wash car washes.

1. https://files.littlebird.com.au/SCR-20260525-ietj.png

2. https://www.abc.net.au/listen/programs/abc-news-daily/the-pr...

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As a fellow Australian, this is likely an early window on what the next 5 to 10 years will yield with our recent mass immigration. Economically speaking we could well see a race to the bottom in wages whilst we continue to experience exceptional housing pressure.

The car wash example is interesting, as something I’ve seen and experienced but never thought about in that way.

I wonder how it truly factors into productivity, though. How is productivity measured, and does that measurement capture what is true?

You mention automated car washes as a baseline. I never used those in the past because I figured they’d be rubbish or would scratch the car or whatever. So I’d occasionally wash the car myself, and that’s it. Now that we have manual car washes available, I use them from time to time. They clearly (I assert) do a better job than anything automated. And they do it inside and out.

So I find the comparison interesting, but in need of elaboration.

It's a tautology, if productivity is measured as GDP per worker. Productivity, so defined, is down because each worker is moving money around less, although there may be more workers. Which is the same thing as them being paid less. Question is, if they accept that, and cars still get washed, does it matter?

Cheap labour is one part of it, but also if you were a wealthy foreigner looking to get residency/citizenship, there are a few visa classes for 'business owners' who met certain job creation/investment thresholds. Car washes were a popular vehicle for this.

> Speaking as an Australian, our productivity has been lagging[1] compared to the US

Good.

Developed countries should not aim to emulate the US. To get the same productivity you’d have to lower the standard of living of all the employees to the same level as those in the US.

No. Don’t do it.

Quality of life matters much more than profits.

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