The findings of a report released this year has concluded that from 2006 to 2011 Australia’s start-up sector added 1.04 million full time comparable jobs to the country’s economy.
The report was developed by the Office of the Chief Economist, spearheaded by Mark Cully from the Department of Industry & Science, in conjunction with the Australian Bureau of Statistics.
James Mabbott, head of innovation services at KPMG, the global accounting behemoth believes that these findings provide the first concrete proof confirming just how integral start-ups are when it comes to job creation in Australia.
It’s the hi-tech, high-growth start-ups which provide the greatest level of job creation. This will hopefully help to differentiate start-ups in the minds of policymakers and the general public from small business at large,” he pointed out.
Despite having fairly high start-up activity levels compared to other countries, this activity is winding back now.
Another concern is that the jobs created per start-up operating in Australia are low in contrast to other OECD nations. Mr Mabbott suggests one possible reason for this is that most of the small to medium businesses classed as start-ups are often just your local small businesses such as bakeries, cafes and lifestyle shops, none of these will be expanding their operations globally, thus their staffing requirements will remain minimal.
“Early this year we saw Sydney drop from 12 to 16 on the Start-Up Compass Global Ecosystem Ranking, with Melbourne falling out of the top 20. It isn’t a question of Australia going backwards, our ecosystem has stalled and other countries are moving ahead quicker with a more deliberate direction and strategy in place. We need to grasp the opportunity if we want to remain competitive,” urged Mr Mabbott
Labor has pledged $5.5 million to back Australian university students who are keen to start-up their own business after graduation. Their policy includes a $10,000 HECs-type loan scheme on top of a 2 year program to support new businesses competing for government tender contracts.
Also in the works are new policies which intend to draw 2000 overseas university graduates and 2000 entrepreneurs to our shores who wish to begin their own business in Australia.