The value that small business adds to Australia’s economy can be calculated by its contribution to Australian Gross Domestic Product (GDP).
GDP measures the total value of final goods and services produced in the economy.

Table 1: Industry value added by business size

Value added by business size

2018-19

2019-20

2020-21

 

$m

%

$m

%

$m

%

Small business

(0-19 employees)

415,794

32.3

423,916

32.5

438,359

32.7

Medium business

(20-199 employees)

287,721

22.4

280,070

21.5

283,780

21.2

Large business

(200+ employees)

583,681

45.3

600,274

46.0

616,701

46.1

Total

1,287,196

100.0

1,304,260

100.0

1,338,839

100.0

Source: ABS Australian Industry, Table 5, May 2022 and ASBFEO calculations, private sector industry. The ABS publish this data for selected industries, which excludes financial and insurance services. Totals may not sum due to rounding.

Small business (employing less than 20 people) added over $438 billion of value in 2020-21. This was 33% of Australia’s total GDP, as shown in Table 1.


Chart 1: Industry value added by business size
 

Chart 4_Industry value added by business size

Source: ABS Australian Industry, Table 5, May 2022 and ASBFEO calculations, private sector industry. The ABS publish this data for selected industries, which excludes financial and insurance services.

As shown in Chart 1, the contribution of economic value compared by business size has not changed much over the past three years.


Table 2: Small business share of the total value added by industry in 2020-21

Industry sector

Small

Medium

Large

All

Small business share

 

$m

$m

$m

$m

%

Agriculture, forestry and fishing

 24,403

 5,591

 1,453

 31,446

78%

Rental, hiring and real estate services

 64,310

 9,880

 12,301

 86,491

74%

Construction

 74,195

 31,018

 25,581

 130,795

57%

Other services

 18,195

 8,610

 5,750

 32,555

56%

Professional, scientific and technical services

 57,860

 42,315

 44,933

 145,108

40%

Health care and social assistance (private)

 42,767

 15,664

 51,771

 110,201

39%

Accommodation and food services

 15,470

 14,613

 10,204

 40,287

38%

Retail trade

 27,386

 16,348

 46,122

 89,856

30%

Arts and recreation services

 3,525

 3,171

 5,263

 11,958

29%

Transport, postal and warehousing

 19,830

 14,084

 37,767

 71,682

28%

Wholesale trade

 17,855

 25,001

 28,875

 71,731

25%

Administrative and support services

 14,972

 22,188

 29,979

 67,139

22%

Manufacturing

 22,762

 34,185

 50,434

 107,381

21%

Public administration and safety (private)

 1,304

 2,277

 3,326

 6,906

19%

Education and training (private)

 5,511

 10,206

 17,379

 33,096

17%

Information media and telecommunications

 3,511

 6,173

 27,263

 36,948

10%

Electricity, gas, water and waste services

 4,659

 7,706

 36,776

 49,142

9%

Mining

 19,845

 14,750

 181,522

 216,116

9%

Total selected industries

 438,359

 283,780

 616,701

1,338,839

33%

Source: ABS Australian Industry, Table 5, May 2022 and ASBFEO calculations, private sector industry. The ABS publish this data for selected industries, which excludes financial and insurance services. Small businesses are those with 0-19 employees, medium businesses are those with 20-199 employees and large businesses are those with 200+ employees. Totals may not sum due to rounding.

You can see in Table 2 that as well as adding a significant contribution to total value, small business adds more value than other business size in the following sectors:

  • Agriculture, forestry and fishing (78% of total value added)
  • Rental, hiring and real estate services (74% of total value added)
  • Construction (57% of total value added)
  • Other services (56% of total value added).

Chart 2: Industry value added by business size in 2020-21
 

Chart 5_Industry value added by business size 2020-21_0

 

Source: ABS Australian Industry, Table 5, May 2022 and ASBFEO calculations, private sector industry. The ABS publish this data for selected industries, which excludes financial and insurance services.

Chart 2 shows that the largest contributions in dollar terms by small business to GDP are in the following industries:

  • Construction ($74.2 billion)
  • Rental, hiring and real estate services ($64.3 billion)
  • Professional, scientific and technical services ($57.9 billion). 

When evaluating according to value added in dollar terms, Australia’s largest industry is mining. Interestingly, you can see that in Chart 2, small businesses contributed only 9% of all value added in the mining sector, compared to 84% from large businesses.

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