The government's jobs and skills summit is less than a fortnight away but there is still intense disagreement over exactly what problems actually exist in Australia's labour market.
Unions and progressive think tanks have pointed to the decade-long stagnation and recent collapse in real wages as the key concern.
Real wages are measured by looking at workers' increase in pay minus inflation, otherwise known as the rising cost of living.
With inflation (as measured by the Consumer Price Index) surging and pay packets (as measured by the Wage Price Index) not keeping pace, over the past year the average worker has seen their standard of living fall substantially.
In fact, real wages for Australian workers are now back at the levels they were a decade ago.
Yet, barring the COVID-19 recession, Australia's economy has grown, albeit rather modestly, over that period.
The Australia Institute's executive director, Richard Denniss, said it was clear where that extra income had gone.
"You would expect the profit share to be rising at the moment, because if prices are going up and wages aren't, that money's got to be going somewhere and economists tend to call that somewhere profit," he told ABC News.
"What we've seen in Australia is a significant redistribution towards profit, particularly towards profit in the mining industry."
The Australia Institute analysed recent Australian Bureau of Statistics figures to back up this claim.
The result of this growth in profit is that the employee share of national income is now less than half.
However, Peter Burn, head of policy for business lobby the AiGroup, said that decline had been driven almost entirely by two industries.
"The labour share has not declined, other than for the mining and finance sectors," he told ABC News.
"All other sectors aggregated, there is no decline in the labour share of income."
In the resources sector, Dr Burn said, this was due to massive investment in expanding mines and machinery during the mining boom, which increased output far more than the need for workers, combined with the current surge in commodity prices increasing the value of that output.
In finance, he explained it was due to increasing automation over the past few decades, which has meant less bank revenue is paid out in wages, with fewer branches and staff.
Dr Burn argued this concentration of rising profits in just two sectors of the economy was crucial for the discussion around wages.
"Is there a general argument to say that business can afford wage increases, because the wages share has fallen, and therefore the capital share has risen?" he asked rhetorically.
"Well, the answer to that is well clearly no for the vast bulk of the economy."
Time for a resources super profits tax?
Richard Denniss is incredulous at this analysis.
"It's a bit weird for people to say, 'Oh, if you take the most profitable sectors out of the measure of profit, profits haven't gone up nearly as much'," he countered.
"Well, yeah, if you took the tallest people out of a classroom, the average height of people in the classroom would be a bit lower.
"If profits in mining are so big that they're distorting our National Accounts, you'd think that's an obvious case for what Joe Stiglitz, the Nobel Prize-winning economist, [has] been saying — why don't we have a windfall profits tax on some of these profits?"
Mr Denniss argued that, especially since the majority of Australia's mining and gas sectors were foreign-owned and much of the profit from the nation's resources headed offshore, it made economic and political sense to increase taxes on that sector and redistribute that profit elsewhere.
"If we, for example, made childcare free, if we made medicine free, if we lowered the cost of aged care, then, by definition, that would push the consumer price index down, that would increase real wages," he argued.
"And it would come at no cost to the non-mining parts of the business community."
The AiGroup has a heavy concentration of manufacturing businesses amongst its membership, many of which are themselves currently struggling with high input costs for gas, energy and raw materials.
Mr Burn said his members would generally be open to a discussion about increased resource taxation.
"I think that that's a great debate to have, and not one that we would stifle in any way," he commented.
"I would note, though, that even under our current system of taxing profits, there is a large share of total taxation on profits from the mining and financial sectors already."
Do workers also benefit from super profits?
Mr Burn also suggested that workers are now receiving a much greater share of profits than they did decades ago, due to compulsory superannuation.
"The claims on the capital share go well beyond the business sector and particularly, the very large increase in the proportion of total capital owned by superannuation funds — workers' capital has increased astronomically over the last 30 years," he argued.
However, Dr Denniss argued this did little to redistribute profits to ordinary working people.
"There's a small number of people with very large amounts of money in superannuation, and a lot of people with very small balances in superannuation," he observed.
"So, the idea that if our wages fall and prices go up because of the profit surge, I'll get that back through my super — for those lucky enough to have $5 million or $10 million salted away in super, that might even be true.
Can you stop paying tax, legally?"But, for the vast majority of people with $20,000 or $80,000 in super, the idea that expensive petrol and low wages are good for them is simply absurd."
The most recent Tax Office figures, from 2019-20, show the median, or middle, Australian had less than $50,000 in superannuation funds.
The average, or mean, balance was much higher at $145,388, skewed upwards by the extremely large super savings held by a relative handful of individuals.
Long-term trend to profits, rents and finance
The trend towards profits over wages, while exacerbated by the recent commodity boom, is not a short-term phenomenon.
Analysis of the ABS National Accounts by the ABC shows wages are around their lowest share of national income on record.
Wages peaked as a share of national income above 60 per cent at points during the 1970s and early '80s, before drifting on a downward trajectory to 49.8 per cent in the most recent, March-quarter, numbers.
So-called mixed income (the profits of unincorporated businesses) has also fallen dramatically, due to a decline in unincorporated sole traders, partnerships and the agricultural sector as a share of the economy.
Research on this longer trend, which pre-dates the recent surge in profits due to the mining boom, finds the finance and real estate sectors have accounted for much of the shift towards profits, with computers and the internet likely also playing a key role.
A 2019 Reserve Bank paper by economist Gianni La Cava found that the banking sector was responsible for most of the increase in profit share over the past three decades.
"Excluding the financial sector, the aggregate labour share has been unchanged since 1990," he observed.
"There were more people employed in finance in 1990 than there are today, and the share of total industry income going to finance workers has nearly halved since 1990."
The growth in finance profits is prominent in the National Accounts and has also been commented on by global bodies such as the Bank for International Settlements.
It also coincided with a dramatic jump in the share of national income going to housing, both rented out and owner-occupied.
"About half of the long-run increase in the housing capital share is due to an increase in the relative price of housing," Dr La Cava observed.
"This has been especially important over recent decades.
"The remainder of the increase in the housing capital share is due to 'real' factors, such as an increase in the average size and quality of owned homes.
"These real factors were particularly important in the period between 1960 and 1990."
In other words, Australians spent more on housing between the 1960s and 90s because we were building bigger, better homes but, over the past 30 years, we have simply paid more for a similar quality of home, mainly due to lower interest rates and an increased capacity to borrow more money.
'Shift towards large firms'
The paper also posited a rise in oligopoly power as a factor that allowed big companies to grow profits without being compelled to pass those gains on to their workforces.
"Since the early 2000s, there has been a shift in economic activity towards large firms," Dr La Cava observed.
"This is true across a range of industries but is most notable in the retail trade sector. The four largest retailers in Australia now account for around one-third of total industry sales.
"Statistical analysis suggests that higher business concentration across industries has lowered the aggregate labour share since the early 2000s."
Finally, Dr La Cava also concluded that, considering historically low levels of inflation (prior to the very recent spike in prices), matched with weaker productivity growth since 2000, workers were probably getting about their fair share of economic growth.
"Since 1995, the growth in real consumer wages has basically matched the growth in labour productivity," he wrote.
A much earlier paper by current Reserve Bank assistant governor (economic) Luci Ellis, written for the Bank for International Settlements in 2007, observed that the trend towards a lower labour share of income was pretty much universal across all developed economies.
Her analysis posited that the rise of information technology across a wide range of industries had resulted in a step lower in the wages share of income.
Richard Denniss believes it is a more fundamental political economic shift towards neoliberal free-market policies that has caused much of the redistribution away from workers towards business owners and landlords.
"We've really radically changed Australia in the last couple of decades," he argued.
"I think the data makes clear that while the economy has changed, our tax system hasn't kept up with it."
