The productivity warning in Australia’s PISA results

Australia’s PISA results remain above the international average, but the trajectory is concerning. The Programme for International Student Assessment (PISA) is a triennial study of 91 countries by the Organisation for Economic Co-operation and Development (OECD) that evaluates educational systems by testing the reading, mathematics and science skills of 15-year-old students.

In the latest round of PISA results, Australian students continued to outperform the OECD average in science, reading and mathematics. However, since the inception of PISA in 2000, performance has fallen – dropping 18 points in science, 22 points in reading and 42 points in mathematics. These declines represent approximately one year of lost learning in science and reading, and two years in mathematics. However, in relative terms, Australia's ranking has remained stable because performance has declined across many countries. 

Australia's talent pipeline is being squeezed from both ends– the proportion of low performers is growing and the proportion of high performers is shrinking. In mathematics, the share of low-performing students has risen from 14.3% in 2003 to 29.1% in 2025, while the share of top performers fell from 19.8% to 9.9%. In reading, low performers increased from 12.5% to 23.4%, while top performers declined from 17.6% to 11.2%. The results indicate that young people may be entering this next phase less prepared for work and further learning.

They also present a mixed picture for an AI-enabled economy. Literacy and numeracy are core skills which underpin critical and computational thinking, problem solving and creativity, capabilities that are needed to effectively interpret and exercise judgement of AI-based information. PISA data revealed that Australian students performed strongly in computational thinking, scoring 32 points above the OECD average. Approximately half of students use AI chatbots for schoolwork at least weekly, and nearly a third use them for research tasks.

However, technical fluency is not the same as AI readiness. Fewer than half of Australian students could reliably distinguish information from misinformation. These findings are echoed in Deloitte's Generational AI Gap research, which found that younger cohorts demonstrated stronger technical AI skills but weaker judgement-based capabilities. Emerging evidence also suggests that “unguided use” of generative AI may weaken learning when they substitute for rather than support cognitive effort. The challenge for schools is to ensure that new technologies complement learning, while also helping students develop the skills needed to thrive in a digital and AI-enabled economy.

The policy imperative is not simply to improve Australia's ranking, but to strengthen the skills and capabilities that underpin future productivity and prosperity. Previous Deloitte Access Economics modelling found that a 5% increase in PISA performance would increase GDP by around $12 billion, equivalent to $61.7 billion in Net Present Value (NPV) realised by 2066.

While declining performance has been a common international trend, some education systems have proved more resilient than others. Their experience highlights the importance of a strong teaching workforce, evidence-based practice and sustained reform efforts. Australia cannot simply import another country's model, but the experience of higher-performing systems suggests that lasting improvement depends on sustained focus, implementation discipline and coherence over time.