The Australian Government is now operating in line with Caretaker Conventions, pending the outcome of the 2025 federal election.
This staff research paper explores the dynamics of entrepreneurship in Australia and their evolution over time. It uses a large firm-level dataset covering years 2002 to 2015.
Key points:
- The rate of firm entry in Australia has been declining since 2005.
- Firms that entered after 2005 also face more risks and a higher probability of exit.
- Small young firms are the main engine of jobs growth in Australia, and a declining number means lower job creation.
- Productivity growth can also be slowing down as a result of diminishing resources reallocation to small firms.
- However, the potency of job creation among individual young firms has not subsided and is even increasing.
- There is space for policy consideration to assist entrepreneurs, once the reason behind the declining trend is understood.
Author: Sasan Bakhtiari