10% of Australians are involved in a new business: Study
Australia has cemented its position as one of the most entrepreneurial nations in the world, with a new study showing 10% of Australians were involved in the setting up or founding of a new business, just behind global leader the United States.
The report, conducted by the Australian Centre for Entrepreneurship and the Global Entrepreneurship Monitor, studied 54 nations including 23 developed countries and found 12% of US respondents were setting up or owned a newly founded business.
But Paul Steffens, associate professor at the Australian Centre for Entrepreneurship at Queensland University of Technology, says the Australian finding is surprisingly large. The 10% refers to people in the process of starting up or have started up already.
In another key finding, Australians are more likely than people in the US to set up a business out of choice, rather than necessity, at 21% versus 15%.
Steffens says Australia has an “entrepreneurial culture”.
“We always think of the US as the bastion of entrepreneurship, and on just about every dimension we’re remarkably similar,” he says.
He says Australia’s conditions and culture are about right for new businesses.
“There’s support by Government agencies. The barriers to starting a new business are very low, and the administrative burdens are reasonable, although many might not agree.
“There’s also a reasonable investment in education that provides for opportunities, and business support networks.”
“And along with the entrepreneurial culture, there’s an element of legitimacy for early-stage businesses within the business community, which has been building for some time.”
Steffens says although Australia’s sound performance during the global financial crisis has played a role in the high number of early-stage businesses, the economy is “not as rosy as we might think.”
“The two-speed economy is very real, and we are being propped up by the resources sector,” he says.
In total, 54 countries participated in the study, which is based on a survey of 2,000 people from each country.
The study also found that an equal amount of men and women were involved in young businesses.
Australia was the leader among developed countries for female participation, with 7.8% of adult women involved in setting up a new business or owning a newly founded business.
But it’s not all smooth sailing. Women were less likely to be involved in high-growth areas of IT and resources and also had more modest growth ambitions than men.
Just 24% of Australian female entrepreneurs said they wanted to grow their business to larger than five employers over the next five years, compared with42% of male entrepreneurs.
Similarly, just 6% of Australian female entrepreneurs sought to have a substantial share of customers from international trade, versus 13.7% of men.
Steffens says women’s more modest growth targets might be a reflection of their changing family responsibilities.
Women were more likely to be involved in the retail and services sectors.