Transport, postal and warehousing was among the sectors that experienced business growth in Australia.
Despite ongoing challenges, the number of businesses in Australia continues to grow, with financial services among the highest-growth sectors, according to recent releases from the Australian Bureau of Statistics (ABS).
From a surge in the number of non-employing businesses to a slight decline in wage growth, the data highlights trends that will impact industries and financial strategies across the board.
To support accountants in navigating this shifting landscape, the five graphs below provide a snapshot of how sectors across Australia are responding to market pressures and preparing for an uncertain future.
1. Business entries and exits: A net gain in a dynamic landscape
The Australian economy saw a net increase of 73,125 businesses in 2023-24, with a 16.8% entry rate and a 14.0% exit rate. While this points to overall business growth, the high churn rate suggests a fast-moving environment where businesses come and go quickly.
2. Industry growth: Financial and insurance services among high-growth industries
Most industries in Australia saw business growth in 2023-24, with transport, postal and warehousing (8.5%) and healthcare and social assistance (7.7%) seeing the most new businesses. Financial and insurance services came in third with a 4.8% increase, reflecting ongoing demand in the sector. Meanwhile, retail stayed mostly flat, and agriculture saw a small decline (-1.3%).
3. Business size: Surge in large and non-employing businesses
The number of large businesses (200+ employees) increased by 6% in 2023-2024, with small-to-medium businesses (5-199 employees) also seeing growth.
There was also a significant 4.9% increase in the number of non-employing businesses, reflecting trends like the gig economy, freelance work and self-employment.
4. Annual business turnover
The majority of industries assessed by the ABS saw a year-on-year increase in business turnover, or the total revenue that businesses generate from their activities in a given period. Turnover grew the most in electricity, gas, water and waste services (21.6%), while mining saw a decline of 8.5%. Overall, the 13-industry aggregate grew by 3.3%.
5. Wage price index
The ABS’s latest Wage Price Index (WPI), which measures changes in the price of labour without factoring in compositional shifts in the labour force, hours worked or employee characteristics, reflects a gradual decline in wage growth over the year. In 2024, the annual movement in the WPI showed a slight decrease from 4.2% in December 2023 to 3.2% by December 2024.
Read more on the effectiveness of business grants to drive business growth: 5 ways to cut government waste in business grants.
