SUMMARY OF FINDINGS

As of June 30 2016, the number of actively trading businesses in the market sector was 2,171,544, an increase of 2.4% from 30 June 2015. From 2014-15 to 2015-16 there was a moderate increase in the business entry rate (from 13.4% to 14.6%) and a small decrease in business exit rate (from 12.4% to 12.3%).




All States and Territories experienced increased business counts from June 2015 to June 2016. New South Wales recorded the largest annual increase over this year (3.0%), followed by the Australian Capital Territory and Victoria (2.9% and 2.8% respectively). Tasmania experienced the lowest growth in business counts during this year (0.4%), though it was the first instance of positive growth for the state in the years reported in this publication.

Industry Construction (Division E) had the largest growth in business counts, increasing by 11,967 units (3.5%) from June 2015 to June 2016. Financial and Insurance Services (Division K) business counts grew the fastest in percentage terms with an increase of 4.7% (8,705 units) between June 2015 and June 2016. This is in part due to the role of the Superannuation Funds industry class, which accounted for 45.1% of the entries in Financial and Insurance Services. Mining (Division M) had the largest percentage decrease at -2.7% ( 218 units). Agriculture, Forestry and Fishing (Division A) had the largest total decrease at 2,737 units (-1.5%).

Companies continue to be the largest and fastest growing Type of Legal Organisation with a 4.4% increase in business counts taking the count from 770,558 in June 2015 to 804,186 in June 2016. Across this same year Partnership counts decreased by 11,017 units (-3.8%). This negative growth for partnerships is evident across all 4 years in the publication. However, there was a 2.0% increase in Sole Proprietors following 3 years of consecutive negative growth. This is being driven by the Transport, Postal and Warehousing Industry Division which accounted for 44.0% of the net entries from June 2015 to June 2016. In line with the long term trend, Public Sector counts decreased by 83 units (-16.6%).

All institutional sector counts recorded growth between June 2015 and June 2016. Financial Corporations were the only Institutional Sector to maintain positive growth throughout all four years covered by this publication.



Key Findings

• Construction (Divisions E) had the highest number of businesses operating in Australia in June 2016 with a count of 346,499 units.
• Electricity, Gas, Water and Waste Services (Division D) had the fewest businesses operating in Australia in June 2016 with a count of 6,113 units
• Accommodation and Food Services (Division H) had the highest entry rate at 19.2%.
• Agriculture, Forestry and Fishing (Division A) had the lowest entry rate at 7.0%.
• Public Administration and Safety (Division O) had the highest exit rate at 16.5%.
• Health Care and Social Assistance (Division Q) had the lowest exit rate at 8.4%.
• Health Care and Social Assistance businesses were the most likely to survive from June 2012 to June 2016, with a survival rate of 74.2% across these years.
• Accommodation and Food Services were the least likely to survive from June 2012 to June 2016, with a survival rate of 53.3% across these years.

A - Agriculture, Forestry and Fishing; B - Mining; C - Manufacturing; D - Electricity, Gas, Water and Waste Services; E - Construction; F - Wholesale Trade; G - Retail Trade; H - Accommodation and Food Services; I - Transport, Postal and Warehousing; J - Information Media and Telecommunications; K - Financial and Insurance Services; L - Rental, Hiring and Real Estate Services; M - Professional, Scientific and Technical Services; N - Administrative and Support Services; O - Public Administration and Safety; P - Education and Training; Q - Health Care and Social Assistance; R - Arts and Recreation Services; S - Other Services

• Transport, Postal and Warehousing (Division I) had the largest change in entry rate moving from 14.2% in 2015-16 to 18.7% in 2015-16. Within the Transport, Postal and Warehousing industry division, Taxi and Other Road Transport had the highest entry and net entry (percentage change) rates at 30.7% and 18.3% respectively.
• Agriculture, Forestry and Fishing (Division A) recorded the lowest entry rate and was one of only four industry divisions to experience a decrease in business counts in 2015-16.
• Within Agriculture, Forestry and Fishing (Division. A), Forestry had the largest decrease in business counts in both total and percentage terms with a decrease of 668 (-15.6%). 64% of the of the net movements in the Agriculture, Forestry and Fishing industry division are driven by only 3 of the 49 industry classes (Forestry, Beef Cattle Farming and Sheep Farming).
• The Construction industry (Division E) contributed the most business entries between June 2015 and June 2016, adding a net 11,967 businesses during that period. While it accounted for only 0.9% of the total Construction industry business counts in June 2015, Other Residential Building Construction was responsible for 23.1% of the net increase in the Construction industry division between June 2015 and June 2016.



States and Territories

Key Findings

• Counts of Businesses increased across all States and Territories from June 2015 to June 2016.
• The largest growth in business counts was in New South Wales at 3.0%.
• The lowest growth in business counts was in Tasmania at 0.4%.
• The Australian Capital Territory had both the highest business entry rate and the highest business exit rate in 2015-16 at 16.3% and 13.4%, respectively.
• Businesses mainly operating in Tasmania were the most likely to survive from June 2012 to June 2016, with survival rate of 65.3% across these years.
• Businesses mainly operating in the Australian Capital Territory were the least likely to survive from June 2012 to June 2016, with survival rate of 59.1% across these years.

• After three years of negative growth, Tasmania recorded a positive growth in business counts between June 2015 and June 2016. The change was partly due to the increase of business counts in the Construction industry (Division E), which overtook Agriculture, Forestry and Fishing (Division A) in 2015-16 as the industry with the largest number of businesses. Business counts for Agriculture, Forestry and Fishing decreased by 1.5% to 5,637 units, while Construction increased by 1.2% to 5,680 units from June 2015 to June 2016.
• New South Wales had both the largest increase and largest growth in business counts, with counts increasing by 20,979, a growth rate of 3.0%. At the industry division level, 26.3% of NSW’s net increase was accounted for by Construction. Construction business counts had the third largest growth at 5.1%, only lower than Transport, Postal and Warehousing and Financial and Insurance Services which both increased by 5.4% to 45,779 and 65,812 respectively from June 2015 to June 2016.
  

  
  

Key Findings

• Most businesses actively trading in Australia in June 2016 were un-incorporated businesses operating in the household sector.
• Between June 2015 and June 2016, the number of non-financial corporations, financial corporations and the household sector increased.
• The non-financial corporations sector had the highest business entry rate in 2015-16 at 15.8%.
• The household sector had the highest exit rate in 2015-16 at 13.1%.
• Financial corporations had the highest survival rate, with 70.5% surviving from June 2012 to June 2016.
• Households had the lowest survival rate, with 59.9% surviving from June 2012 to June 2016.

Key Findings

• Between June 2015 and June 2016, the number of actively trading companies, trusts and sole proprietors increased while the number of actively trading partnerships and public sector businesses decreased. In 2015-16, business entry rates were highest for sole proprietors at 18.6%.
• In 2015-16, business exit rates were highest for public sector businesses. Public sector businesses were the least common, with only 499 actively trading in goods or services in Australia in June 2016.
• Trusts had the highest survival rate, with 70.5% surviving from June 2012 to June 2016.
• Sole Proprietors had the lowest survival rate, with 51.0% surviving from June 2012 to June 2016.

Employment Size Ranges

Key Findings

• In June 2016, 60.7% of actively trading businesses in Australia had no employees, 27.6% had 1-4 employees, 9.2% had 5-19 employees and 2.3% had 20-199 employees. Only 0.2% of businesses had 200 or more employees
• For businesses operating in both June 2015 and June 2016, there was a net movement of 15,377 businesses away from having 1-19 employees. 85.3% of this movement was into the non-employing category.
• Between June 2015 and June 2016, the non-employing category had the largest net movement (14,402 units) from changes in employment size range.
• The more employees an ongoing business had in June 2012 the more likely it was to survive to June 2016.
• In 2015-16, business entry and exit rates were highest for businesses with no employees (16.6% and 15.1% respectively) and lowest for businesses with 20-199 employees (2.3% and 3.9%).

Key Findings

• In June 2016, 59.3% of actively trading businesses had annual turnover of less than $200K.
• Among businesses operating in both June 2015 and June 2016, there was a net movement of 25,026 units out of the $50K to $2 million turnover range. A majority of these units (17,891 businesses) moved into the less than $50k turnover range in June 2016.
• The higher the turnover of a business in June 2012, the more likely it was to survive.
• The higher the turnover of a business which began operating in 2012-13, the more likely it was to survive.
• In 2015-16, business entry rates were highest for businesses with annual turnover of between $50K and less than $200K (20.2%) and lowest for businesses with annual turnover of $2 million or more (3.4%).
• In 2015-16, business exit rates were highest for businesses with annual turnover of less than $50K (19.4%) and lowest for businesses with annual turnover of $2 million or more (3.9%).