Indigenous Business Australia has told the Treasurer's Economic Reform Roundtable how the First Nations 'demographic dividend' can boost Australia's productivity by increasing labour force participation and enhancing innovation.

The submission provides data and modelling centred around population, participation and productivity.

IBA's submission demonstrates that when Aboriginal and Torres Strait Islander people are included in economic decision-making and have access to critical levers, their contributions can boost Australia's economic prospects.

IBA chair Darren Godwell said the case "couldn't be stronger" for recognising Indigenous people as a driver of Australia's future prosperity.

"Aboriginal and Torres Strait Islander people could make up between 4-7% of the Australian population in 20 years," Mr Godwell said.

"The proportion of First Nations people within the prime working ages of 20-54 years could increase by 57 per cent over that time.

"First Nations people with a tertiary qualification have not just closed the employment gap, their employment rates are higher than non-Indigenous tertiary qualified people."

Mr Godwell said the growth in education "could mean First Nations people add over $53 billion extra to the Australian economy over 20 years".

"And those gains will compound over the next few decades," he said.

IBA says while the First Nations participation rate remained the same between 2016 and 2021, the proportion of working age employed Indigenous people increased from 47 per cent to 50 per cent.

Mr Godwell says Australia's Indigenous population demographic bucks the national trend.

"In contrast to the rest of the country, which is rapidly ageing, the youthful First Nations population will provide a growing source of economic vitality. Indeed, the number of First Nations tertiary-qualified graduates in employment could increase to over 87,000 in a decade," he said.

"Those workers, entrepreneurs and leaders will provide new energy, and draw on ancient knowledge to create cultural renewal, economic participation and Indigenous-led innovation.

"And with Aboriginal and Torres Strait Islander people having an interest or ownership stake in over 50% of Australia's landmass – over 80% in the north – First Nations people must have a seat at the economic table."

IBA's submission indicates the greatest benefits for Australia will come from First Nations people using traditional knowledge, systems and frameworks to drive the next stage of Australian innovation.

It calls for three policy reforms which IBA says can shape the direction of Australia's productivity and sustainability story in a manner that is consistent with the task as put by the Treasurer:

Reform 1: Indigenous Economic Policy Clarity and Single-Desk Responsibility;

Reform 2: Drive Investment Efficiency with Traditional Owner Empowerment; and

Reform 3: Leverage Australia's Indigenous Demographic Dividend.

"Ancient First Nations frameworks for thinking about the world offer new ways for non-First Nations people to consider our activities, particularly through a sustainability lens that focuses on the role of maintaining and Caring for Country," Mr Godwell said.

Mr Godwell said Indigenous leaders and their responsibilities as Lore Men and Lore Women are "in the best position to determine how to successfully unlock greater productivity potential within the Indigenous estate".

"But that requires greater respect to be accorded to them, their position and their knowledge. Only through their guidance can we find ways forward to shape the nature and terms of economic activity on Country.

"Doing so would promote investment certainty, boost economic investment decisions, reduce the time drag on development pipelines, reduce development friction, and advance the national interest."

Led by treasurer Jim Chalmers, the Federal Government's Economic Reform Roundtable will be held in Canberra from 19 to 21 August.

IBA's Economic Reform Roundtable submission can be found online.