jobs – or overseas websites take your customers – will naturally dampen anyone's enthusiasm for raising their asking prices. but an important step in the march of the robots is often forgotten : technological progress requires business investment. first, as with every wave of technology, someone has to design and make the robots. next, businesses must invest to implement those new technologies and processes. jobs will still get created in both stages, but they are different jobs to the ones replaced. the issue is therefore one of distribution : whether particular countries have the skills needed to become part of that next wave of jobs, and how the income from the ensuing increase in labour productivity is shared between labour and the owners of capital. these are important questions for society, but they don't repeal the laws of supply and demand. how resilient will consumption growth be if income growth stays weak? the previous two uncertainties were general to both the global economy, especially the major advanced economies, as well as australia. we are in a different place in terms of the amount of spare capacity that remains, but the overall drivers and questions might not be that different. one aspect of recent developments where australia's experience differs, though, relates to household income and consumption. as we discussed in the statement, consumption growth in the major advanced economies has been quite robust, supported by strong growth in employment. in australia, we've also had especially strong employment growth over the past year – more than double the rate of growth in the working - age population. but that hasn't translated into strong consumption growth. household income growth has been weak for a number of years, and that has weighed on consumption growth ( graph 4 ). consumption growth hasn't slowed as much as income growth. this is what you'd expect, given that households generally try to smooth their consumption through episodes of income volatility. but there's a real question of how long that could continue if income growth stays weak. this clearly has implications for how we think about the risks to our consumption forecasts. graph 4 the weakness in incomes goes beyond the downward pressure on wage growth that i've already spoken about. yes, growth in the wage price index ( wpi ) has stepped down. but the wpi captures a fixed pool of jobs. it abstracts from compositional change. average earnings as measured in the national accounts have been even weaker than the wpi ( graph 5 ). this has not occurred because workers shifted between industries ; it

a voluntary agreement with the relevant provider. this would be similar to the approach adopted with american express and paypal. in the event that this were not possible, the bank would discuss with the australian government the best way to address the issue. more broadly, as i discussed above, the current treasury review of the regulatory architecture provides an opportunity to look holistically at this issue and whether the existing legislation and regulatory provisions could be amended to better reflect our modern and dynamic payments ecosystems. conclusion so that is a quick review of some of the issues that the payments system board and the rba staff have been focusing on recently. it is clear that payments is an increasingly exciting area and that significant innovation is occurring. this presents opportunities to deliver improved services to end users of the payments system as well as raising new questions for policymakers. the bank very much appreciates the ongoing engagement we have with the industry as we jointly work towards better outcomes for the australian community. thank you. 6 / 6 bis central bankers'speeches