There has been a lot of talk about competitiveness and our loss of competitiveness in terms of labour costs. Yes that is a factor.
But as a people we are also declining in productivity and in front line manufacturing/production. We are moving more towards a services based economy and producing less and less.
We need to churn out more engineers, scientists etc and less people in services who merely ride on the backs of the producers in our economy.
I work for a multinational corporation and am involved in front line production of software. In our company maybe 10% of the workers produce something. The other 90% who work with us are involved in services such as catering, security, finance, hr and management. It is often the people in services who earn the most money. It is the same across the economy, too many people not producing anything yet getting paid far too much. With so few people producing anything, the whole eoncomy will remain weak.