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However, less than 10 per cent of SME owners are under 30, less than half of what it was back in the mid-1970s.
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Small businesses account for one-third of Australia’s GDP
26 June 2023
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Small businesses account for one-third of the nation's GDP as their value to the economy surpasses half a trillion dollars, according to a report released by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Bruce Billson.
The report, Small Business Matters, which was released to coincide with World Micro, Small and Medium-sized Enterprises Day on 27 June, revealed the importance of small entities to the nation’s workforce, with 2.5 million small businesses providing jobs for 5.1 million people as well as employing 42 per cent of apprentices and trainees.
ASBFEO found 51 per cent of workers employed in the professional, scientific and technical services sector are employed by small businesses, only behind the agriculture industry at 79 per cent, the real estate and rental sector at 74 per cent, and construction at 65 per cent.
Mr Billson said small businesses are a crucial part of the economy and continue to overcome challenges such as the pandemic, skills shortages and the softening economy.
“Small businesses are the lifeblood of our communities, and we celebrate the vital contribution they make to Australia’s prosperity, wellbeing, and community,” said Mr Billson.
“This is a terrific opportunity to say thank you and show support to the small businesses who matter in our lives.”
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“Small businesspeople come with varied ambitions, backgrounds and experiences. What they have in common is the entrepreneurial flare and desire to have a go.”
Despite the report finding the average small business owner was a self-employed man, aged 50 working full-time and earning the average full-time wage, it also revealed an increase in ownership by women.
It found women now account for 35 per cent of all small firm owners, with the number rapidly increasing.
However, the ASBFEO also discovered only eight per cent of owners of small organisations are younger than 30 – less than the 17 per cent it was in the mid-1970s.
“We need to replenish and nurture the next generation of entrepreneurs, value self-employment and encourage and enable smaller enterprises and the livelihoods they make possible,” said Mr Billson.
“We need to understand why it is not as appealing as it perhaps should be for younger Australians to own a small business.”
Despite their importance to the economy, Mr Billson said approximately 43 per cent of small businesses failed to make a profit with 75 per cent of owners taking home less than the average wage.
“Yet, the spirit that drives people to run a small business also makes them great advocates for and contributors to their community and they are more likely than the general population to volunteer for an organisation or group,” he said.
“Our small and family business owners and managers are great people and we salute the terrific contribution they make everywhere, every day.”
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