The small business landscape
There are over 870,000 small businesses in New South Wales, making up 97% of all businesses in the State. The NSW Government is committed to finding ways to support small businesses to start and thrive.
The small business landscape has experienced significant economic challenges in the years since the COVID-19 pandemic. Rising input costs, staff shortages, elevated interest rates, compliance burdens, cash flow issues and weaker customer demand continue to weigh on small business confidence.
The Small Business Commissioner runs a monthly Small Business Momentum Survey tracking business confidence. In December 2024, the survey found:1
86% | of businesses were worried about the cost of business inputs |
74% | of businesses were concerned about cash flow and the availability of working capital |
28% | of businesses indicated they have plans to grow, alter or expand operations |
Significantly too, in 2024, CreditorWatch data showed an average increase in the rate of insolvencies of 38% over the year to May 2024 across all industries in Australia. The total number of insolvencies was up 34% year-on-year and 41% above its pre-COVID maximum.2
Small businesses operate in every town and region of NSW. 71% of small businesses are based in the Sydney Metropolitan Area, and 29% in the regions. Almost 1 in 3 small businesses are owned by women and 35% of small business operators were born overseas.
The top five small business industries are:
- Construction
- Professional, scientific and technical services
- Rental, hiring and real estate services
- Transport, postal and warehousing
- Health care and social assistance.3
Small businesses are critical to job creation, innovation, and driving economic resilience both locally and globally. NSW small businesses remain a cornerstone of the state’s economy.
References
1Business Bureau delivers for business in its first year, 2 November 2024 https://www.nsw.gov.au/media-releases/business-bureau-delivers-for-business-its-first-year
2Business insolvencies surge to record high – rate increases 38% on average across all industries, 18 June 2024 https://creditorwatch.com.au/blog/one-in-13-hospitality-businesses-facing-failure-in-12-months-b2b-payment-defaults-hit-record-high-2
3Small Business Commissioner – Small Business Landscape https://www.smallbusiness.nsw.gov.au/about-nsw-small-businesses
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