There is little danger this year of voters struggling to differentiate between the two major parties on economic matters. In speeches this week, the prime minister and opposition leader revealed two starkly opposed views on how the economy should be run. Both sides are gearing up for a fight of labour versus capital, and at its core is wages growth and how and when that should be achieved.

Since the Keating enterprise bargaining reforms, industrial relations has in some ways involved a bipartisan light touch. Essentially, both parties took the view that governments should play a minimal role and let the employers and unions negotiate in a spirit of good faith.

Yes, the Howard government sought to change things with WorkChoices, but even with the Fair Work Act, the belief that flexibility with a safety net was best, remained intact. The spirit of light touch and good faith remained a cornerstone of the system.

For Shorten, that system is now broken.

Where once, for example, the termination of enterprise agreements was a legal but rarely used option, now it is a standard operating procedure – forcing negotiations to start not from the previous agreement, but from the award rate.

It is also a system that assumed a strong correlation between profits and wages growth, a linkage Shorten would argue is now weakened because of the reduction in union bargaining power through policies and efforts over the past 20 years designed specifically to reduce that power.

Shorten is no radical – in essence he just wants the spirit of the Keating enterprise bargaining system returned. But the more than two decades of light touch has (perhaps unsurprisingly) led to a situation where wages growth above inflation is now seen as generous, rather than expected.

Shorten, in his speech at the National Press Club this week, argued his priority was to make “our economy work for all working Australians – so that people who work hard can get ahead and that people who are doing it tough don’t get left behind”.

He promised four initiatives: restoring Sunday penalty rates, a “crack-down on the exploitation of labour hire”, addressing the reduction of those on enterprise bargaining agreements, and “a new national push to close the gender pay gap”.

His focus is clearly on the worker side of the bargaining table.

For Turnbull, the system is not only unbroken, it is working as it should. He is that most perfect of Liberal party politicians – one who preaches for free markets and for governments to get out of the way, and who also legislates to ensure the government gets in the way to skew the market in favour of employers by doing all he can to reduce unions’ ability to negotiate effectively.

Where Shorten is making the pitch for governments to get involved to protect workers’ conditions – even suggesting putting a floor on the minimum wage relative to the median wage – Turnbull preaches from the same song sheet of the past 20 years, telling the party faithful in Toowoomba on Thursday: “Let’s be very clear about this; the laws of supply and demand have not been suspended.”

The prime minister argued that “wages growth will come, because a stronger economy results in more investment, more jobs and more intense competition between employers for workers”.

The combination of the ALP’s shift towards a heavier (if still an historically very light) IR touch, coupled with the fight over company tax cuts, has not surprisingly seen companies come out in strong defiance of Shorten’s stance and in favour of the Liberal party’s polices.

Company tax cuts will lead to wonderful things, the CEOs would have us believe, and better times for workers will come ... eventually.

The CEO of Wesfarmers told the AFR: “We are committed to giving our people wages growth when the business environment allows. ” That is, when they decide it allows.

The CEO of Qantas, Alan Joyce, also told the AFR that the company tax cut would allow the airline “every opportunity” to open up new routes, buy more aircraft and employ more staff.

At this point it probably is worth recalling that Qantas paid zero tax in 2013-14, 2014-15 and 2015-16.

The prime minister argues the recent increases in employment prove the government’s policies are working.

He told the Toowoomba audience that “our business tax cuts in 2017 helped create a record 403,100 jobs in that year”. And yet two-thirds of those jobs came in health, education and construction – areas that are largely public-sector based or, in the case of construction, booming due to a massive increase in public infrastructure spending.

Shorten argues that the lack of wages growth while profits and employment are growing proves the system no longer works. For Turnbull, it proves nothing other than we need more patience – supply and demand will ensure it will happen.

The economic fight for the next election is well and truly set, and for both sides, wages growth will be the key.

Continuing low growth will strengthen the ALP’s case; improved growth will see the government argue that all is well again.

And either outcome will likely be a large factor in determining not only whether we go to an election this year, but also the result.