Ask any economist what the two dominant forces driving the global economy are now and in the next 20 years and there is a fair chance that technology and demographics will both be in the top 5.
These two forces are reshaping people’s lives and they are, according to the latest Australian Bureau of Statistics data count of the number of businesses in Australia, also reshaping the face of Australian business.
Overall there were 2,121,235 businesses in Australia at the end of the 2015 financial year. Craig James, Commsec’s chief economist, highlighted that Construction (16.3%), Professional, Scientific and Technical services (12%), and Rental Hiring and Real Estate services (11%) were the big three when it comes to the number of businesses.
But he said it is retail (6.2%) and healthcare (5.6%) which are seeing the big moves in the number of businesses operating in the Australian economy as the internet and an aging population drive change (our emphasis):
- One thing is clear from the latest data – the number of retailers continues to slide. Just over the last year, the number of retailers fell by 2,500 – the fourth straight year of declines. Intuitively, the disruption from the internet is to blame with retailers facing global competition as Aussies increasingly buy from abroad. Increased competition and price disinflation is causing consolidation across the retail sector.
- The other thing that is clear is that the services sector continues to grow, a key factor driving the good performance of the job market. Over the past four years the number of businesses in the Healthcare sector has lifted by 16 per cent – at a time when the number of businesses have gone backwards by 0.5 per cent. Financial sector businesses have also lifted almost 12 per cent since the end of June 2011, largely underpinned by the number of superannuation funds.