Published 18 April 2017 Category: Business, Insights

Top business trends in Australia in 2017

Australia isn’t just geographically farther away but has been distancing itself from the economic turmoil over the years. For a quarter of a century, the country’s economy has experienced a sustainable unbroken growth amid chaos from Asian financial crisis to dot-com bubble burst.
But such overtly optimistic tone might no longer be applicable in 2017. In September 2016, Australia recorded a contraction in GDP by 0.5 per cent - the largest quarter economic shrunk recorded since 2008. Australian treasurer Scott Morrison described the contraction as “more than a warning for Australia”.
By the end of 2016, the Treasury slightly marked down its economic forecasts in its budget update, but it still saw a growth at 2.75 per cent in 2017, higher than average for the past eight years. With China’s economic slowdown, topped by the uncertainties brought by Brexit and the Trump administration, analysts have advised a cautious approach to conducting business in Australia, which will be dominated by new business trends.

Traditional, heavy industries might fade out
Australia’s unemployment rate is at 5.7 per cent - one percentage point higher than that in the US. The country’s underemployment rate is even higher - around 8.5 per cent of the labour force are not getting enough work, much more so than early 1990s when the country was facing recession.
The supply of jobs in Australia could be under threat, considering major manufacturing industries are cutting down the number of jobs. Following Ford’s shut down which resulted in 600 jobs cut, Holden and Toyota might follow suit, bringing about an estimated 40,000 job loss in 2017.
The mining industry could also be another issue as the investment bust continues. Construction boom is also expected to peak. This poses a threat to Australian economy in these two years as the construction industry accounts for nearly 10 per cent of the employment, and not to mention the relevant jobs in the property industry.

Startup ecosystem will grow bigger in 2017
Market watchers are gradually moving away from traditional heavy industries and paying much closer attention to the startup ecosystem, which is something that the Australian government actively cultivates.
In November, the Australian federal government introduced a new legislation that allows startups and small businesses that are not publicly listed with less than A$25 million assets to crowd-fund new capital of no more than A$5 million from everyday investors.
This makes startups and small businesses a lot easier to grow. Startups dealing with blockchain technology, video and mobile content and mobile experiences design are boasting the most promising future.
Niche companies will have a greater edge
Niche companies are likely to find success easier, analysts said, as they offer products and services that fill the gap of the market. They target at a smaller but very specific audience by offering customised services that are likely to be irreplaceable.
This will lead to the growth in digital marketing and e-commerce platforms, resulting a demand for skilled labour. The shift from traditional, heavy industries, to digital is inevitable in Australia, where people should fasten their seatbelts and embrace the positive economic disruption brought by technology.