The Australian technology sector represents a dynamic and evolving landscape, encompassing 63,927 software and computer system design businesses alongside manufacturing, wholesaling, and retail operations. With 353,900 people employed and contributing $46 billion to GDP, the sector demonstrates both opportunities and challenges for entrepreneurs and established players alike.

‍

Australian Tech Sector Statistics at a Glance

✅ 63,927 tech businesses operate in Computer System Design and Related Services as of June 2025, representing 2.3% of all Australian businesses

✅ 97.6% of tech businesses are small enterprises, making it one of the most entrepreneurial sectors in the Australian economy

✅ The sector employed 353,900 people as of May 2025, with employment up 34% over five years

✅ Only 50.4% of tech start-ups survive three years, though the ACT achieves a remarkable 59.9% survival rate

✅ 53.7% of tech businesses are solo operations, significantly lower than the 62% average across all Australian industries

✅ NSW dominates with 37.8% of all tech businesses (24,193 total), followed by Victoria at 29.5%

✅ The sector contributed $46 billion to GDP (1.72% of total)

‍

How Many Tech Businesses Operate in Australia?

Australia's technology landscape is thriving, with 63,927 businesses operating in the Computer System Design and Related Services Industry as of June 2025. This represents the backbone of Australia's tech and computer software sector, making it the 7th largest category of businesses at this industry classification level. Of the top 10 industries, it ranks as the 2nd largest in terms of businesses with one or more employees.

Source: ABS Count of Australian Businesses, June 2025

‍

The sector demonstrated robust growth with a 2.70% increase year-on-year, adding 1,682 new businesses compared to the June 2025 financial year. This expansion was driven by 10,639 new tech businesses launched throughout the year, significantly outpacing business closures.

Source: ABS Count of Australian Businesses, June 2025

‍

"The Australian tech sector's resilience is evident in its continued entrepreneurial momentum, with thousands of new businesses launching each year despite challenging economic conditions. This speaks to the enduring opportunities in digital transformation and technology services."

Rich Atkinson, Founder of Airteam

‍

Small Business Dominance

Small businesses continue to dominate, comprising an impressive 97.6% of all tech businesses – a slight increase from 97.4% in the previous year. This growth demonstrates the entrepreneurial spirit driving Australia's digital transformation. Queensland leads in small business concentration with 98.2% of its tech businesses classified as small enterprises, highlighting the state's supportive environment for emerging technology companies.

Source: ABS Count of Australian Businesses, June 2025

‍

Large Tech Employers

Australia hosts 84 major tech businesses employing more than 200 staff members. The sector saw healthy movement with 3 businesses scaling up to this category. In total, the tech industry represents 1.6% of all large businesses (5,322 total) with over 200 staff members across Australia.

Source: ABS Count of Australian Businesses, June 2025

‍

Which States Lead Australia's Tech Industry?

Six states and territories boast tech industries with over 1,000 businesses: NSW, Victoria, Queensland, SA, WA and the ACT. Victoria emerged as the fastest-growing tech hub of the major states, recording impressive 3.8% growth over the past year.

New South Wales dominates with 37.8% of all tech businesses (24,193 total), followed by Victoria at 29.5% (18,874 businesses).

Source: ABS Count of Australian Businesses, June 2025

‍

NSW's Supply Chain Dominance

NSW holds a commanding position across the computer supply chain, accounting for 44.4% of manufacturing businesses and 46.2% of wholesaling businesses in the tech sector. This concentration reflects the state's role as Australia's primary technology hub.

Source: ABS Count of Australian Businesses, June 2025

‍

The ACT's Thriving Tech Ecosystem

The ACT demonstrates a strong representation of software businesses relative to its size, indicating a thriving tech sector supported by a highly skilled, service-based workforce. The territory's 59.9**% three-year start-up survival rate** – a remarkable 9.5% above the national average – further reinforces its position as a supportive environment for technology entrepreneurs.

Source: ABS Count of Australian Businesses, June 2025

"Regional differences in tech sector performance tell us a lot about local business ecosystems. The ACT's exceptional start-up survival rate isn't accidental – it reflects a combination of skilled talent, government sector proximity, and strong support networks that other states can learn from."

Rich Atkinson, Founder of Airteam

‍

Victoria's Retail Leadership

NSW leads in all categories now, at the end of June 2024 Victoria had the highest number of businesses in computer retailing, exceeding NSW by 7 businesses. However, this has changed with NSW now having 13 more computer retailing businesses.

Source: ABS Count of Australian Businesses, June 2025

‍

How Many Tech Startups are Founded by Individuals?

The tech space is dominated by solo entrepreneurs, with 53.7% of tech businesses operating as non-employing, single-person enterprises. However, relative to other industries, this figure is quite modest. Consultants operate at 62% solo businesses, and across all Australian industries, the average is 62% – making tech actually less solo-focused than the broader economy.

Source: ABS Count of Australian Businesses, June 2025

‍

This statistic varies considerably by state:

Australian Capital Territory: 32.4% solo operations (lowest)
New South Wales: 50.2%
South Australia: 61.6% solo operations (highest concentration of tech solopreneurs)
Source: ABS Count of Australian Businesses, June 2025

The lower proportion of solo operators in tech compared to other sectors suggests that technology businesses may require collaborative teams or employee support earlier in their development than traditional service businesses. The state variations likely reflect differences in local market size, access to talent, and the nature of tech work being undertaken in each jurisdiction.

‍

What is the Survival Rate of Startups in the Tech Sector in Australia?

10,736 businesses entered the tech sector in FY22, providing a clear cohort to track survival rates over subsequent years. The survival statistics reveal the challenging nature of tech entrepreneurship:

77.8% survived their first year in business
60.0% survived the second year of business
Just 50.4% survived the third year
Source: ABS Count of Australian Businesses, survival analysis of FY22 cohort

"The three-year survival rate tells the real story of tech entrepreneurship. Half of businesses don't make it, which means founders need more than just a good idea – they need sustainable business models, access to capital, and the resilience to navigate early-stage challenges. The states that are outperforming have clearly created environments that address these needs."

Rich Atkinson, Founder of Airteam

‍

State-by-State Survival Performance

There is considerable variation in start-up survival by state:

ACT: 59.9% (highest, 9.5% above national average)
South Australia: Above national average
New South Wales: Slightly above average
Queensland: Just below 50%
Western Australia: 48.7% (lowest among major states, significantly underperforming)
Victoria: Slightly below average
Source: ABS Count of Australian Businesses, survival analysis of FY21 cohort

‍

Western Australia's underperformance is particularly notable given its status as a resource-rich economy with growing tech ambitions. The data suggests that while the state has made considerable efforts to diversify beyond mining and resources, its tech companies struggle to survive at the same rate as those established in the eastern states.

‍

What Are the Biggest Areas of Australia's Tech Sector?

There are four key areas that make up the tech sector in Australia:

Computer System Design and Related Services (the software tech sector)
Computer and Electronic Office Equipment Manufacturing
Computer and Computer Peripheral Wholesaling
Computer and Computer Peripheral Retailing

Source: ABS Count of Australian Businesses, June 2025

‍

Software Dominates the Tech Landscape

The largest element of the tech sector in Australia is the software sector (Computer System Design and Related Services), totalling 63,927 businesses, including 84 large businesses with over 200 employees each.

In comparison:

Computer manufacturing sector: 0 large businesses, 297 total Businesses
Wholesaling sector: 11 large businesses, 1,172 Businesses
Retailing sector: 4 large businesses, 2,703 Businesses
Source: ABS Count of Australian Businesses, June 2025

The software industry is also the strongest component, representing the only growing segment within computer tech. While software businesses expanded 2.70% year-on-year, the other three sectors experienced contraction or stagnation.

Source: ABS Count of Australian Businesses, June 2025

‍

This dominance of software over hardware reflects global trends toward digital services, cloud computing, and software-as-a-service business models. The absence of large manufacturing businesses highlights Australia's position as primarily a consumer and services provider in the global tech supply chain rather than a hardware manufacturer.

‍

How Many People Work in Australia's Tech Sector?

The tech sector employed 353,900 people as at May 2025. Tech sector employment has remained steady over the past year, with around 400 more people employed than 12 months prior.

Source: Australian employment data, May 2025

‍

However, the dynamic of work has changed significantly, with a shift of nearly 4% of jobs to part-time arrangements:

Full-time employment has fallen 3.8% or 12,500 to 316,052 people
Part-time employment has risen 51.3% or 12,800 to 37,864 people employed part-time
Source: Australian employment data, May 2025

‍

Five-Year Employment Growth

Despite recent stagnation, long-term trends remain positive. Employment is up 34% over five years, representing 89,480 more people employed in the tech sector compared to 2020.

Source: Australian employment data, May 2025

"The shift to part-time work in tech is fascinating and potentially concerning. It could represent greater flexibility and work-life balance, which many in the sector value. But it might also signal underemployment or businesses managing costs by reducing hours rather than headcount. Understanding which scenario dominates will be crucial for workforce planning."

‍

Rich Atkinson, Founder of Airteam

The dramatic 51.3% increase in part-time employment over just one year suggests structural changes in how tech work is being organised. This could reflect the rise of contract work, the gig economy penetrating tech services, businesses adapting to economic uncertainty, or genuine preference shifts among tech workers. The trend warrants close monitoring to understand its implications for job quality and sector sustainability.

‍

How Much Value Does Australia's Tech Sector Add?

The size of the technology sector in Australia is $46 billion, representing 1.72% of Total GDP.

Source: Australian GDP data, FY24-25

The $46 billion contribution, while substantial in absolute terms, represents a relatively modest share of Australia's total economy. For context, this places the tech sector below its proportional representation in other developed economies, suggesting potential for future growth – or highlighting structural challenges in scaling Australian tech businesses to global competitiveness.

‍

Australia's technology sector has demonstrated consistency since 2008 that few industries anywhere in the world can match, steady, compounding growth that held through financial shocks, a pandemic, and successive cycles of economic uncertainty.

The FY25 Industry growth was flat at 0%, a notable departure from an otherwise unbroken trend. This is particularly concerning given that the world is being reshaped by technology and artificial intelligence, conditions that should be driving growth. Instead, it flatlined.

‍

Data compiled from ABS Count of Australian Businesses (June 2025), Australian employment statistics (May 2025), and GDP analysis (FY24-25). All figures represent the most recent available data at time of publication.

Share this post