The Business Council of Australia has highlighted the urgent need to raise education standards to boost the country's profitability and productivity.

Australia's performance in OECD assessments has significantly declined since 2006, with rankings dropping from 6th to 12th in reading, 6th to 10th in science, and 8th to 16th in maths by 2022.

There is a critical need to improve year 12 retention rates, which have fallen to the lowest level in over a decade, with only 80% of students completing high school last year.

These educational deficiencies are directly linked to skills shortages in essential sectors such as housing, energy, and the digital economy.

Bran Black, CEO of the Business Council, warns that without improved student achievement, Australia's economic prosperity and job pipeline will be at risk.

He emphasizes that basic skills and education are crucial for Australia to excel in AI, digital skills, and advanced manufacturing sectors.

Mr. Black supports the Federal Government's focus on early intervention, particularly endorsing the Year 1 phonics screening test to enhance foundational literacy skills.

The recent Better and Fairer Schools Agreements aim to improve student retention and emphasize evidence-based teaching methods in reading, science, and maths.

To further support students, Mr. Black asserts that all schools should have access to modernized and standardized career guidance.

Prime Minister Anthony Albanese has announced that Victoria and South Australia have agreed to the Federal Government's schools funding agreement, with Queensland and New South Wales still pending.

In the latest budget, the Albanese government allocated $641 million to support small businesses, which includes a $20,000 instant asset write-off and energy bill relief for eligible businesses.

In response to these educational challenges, the Business Council is advocating for new targets to restore Australia to the top 10 in OECD rankings for reading, science, and maths.