Australia had 2,656,469 small businesses at 30 June 2025, 97.3% of all 2,729,648 actively trading businesses in the country, according to the Australian Bureau of Statistics’ Counts of Australian Businesses, released in August 2025. That count covers any firm with fewer than 20 employees, from sole traders working alone to firms with a small crew on the books. The bigger story sits inside that number: almost two in three Australian businesses employ nobody but the owner.
How many small businesses are there in Australia?
The Australian Bureau of Statistics (ABS) counted 2,656,469 small businesses, defined as firms with fewer than 20 employees, operating in Australia at 30 June 2025. That is 97.3% of the 2,729,648 actively trading businesses on record, leaving just 73,179 businesses classed as medium (20 to 199 employees) or large (200 or more).
Almost all of that headline figure is made up of businesses with very few, or no, staff at all. The table below breaks the national count down by employee size band, using the ABS’s August 2025 statistical release.
| Employee band | Businesses | Share of all businesses |
|---|---|---|
| No employees | 1,735,470 | 63.6% |
| 1 to 4 employees | 688,870 | 25.2% |
| 5 to 19 employees | 232,129 | 8.5% |
| All small businesses (0 to 19) | 2,656,469 | 97.3% |
| Medium (20 to 199) | 67,857 | 2.5% |
| Large (200 or more) | 5,322 | 0.2% |
Figure 1: Share of Australian businesses by employee count. Source: Australian Bureau of Statistics, Counts of Australian Businesses, August 2025.
A typical Australian small business, by this count, is far more likely to be a single tradesperson or a solo consultant than a company with a shopfront and a payroll. That skew toward tiny operators is exactly why the “small business” label covers such a wide range of legal and tax situations.
What counts as a small business in Australia?
The ABS uses a simple headcount test for its national statistics: any actively trading business with fewer than 20 employees is classed as small. That single threshold is what produces the 2,656,469 figure used throughout this article, and it is what most journalists and researchers cite for a single national number.
The reality underneath it is more layered. The Australian Taxation Office (ATO) applies a turnover test instead, treating any business with annual turnover under $10 million as a small business entity for most tax concessions. Using that definition, around 98% of Australian businesses qualify as small, and roughly 92% of those turn over less than $2 million a year. The two definitions overlap heavily but are not identical, since a business can run lean on headcount while turning over well past the ABS threshold, or the reverse.
Figure 2: How Australia’s two working definitions of small business are built. Source: ABS Counts of Australian Businesses methodology; Australian Taxation Office small business entity eligibility criteria.
For anyone reading an Australian small business statistic, the practical takeaway is to check which definition sits behind it. A 19-employee headcount cutoff and a $10 million turnover test can sort the same firm into different categories depending on which agency published the number.
How has the number of Australian small businesses changed recently?
Australia’s business population is not moving in a straight line. The total count of actively trading businesses rose 2.8% in 2023-24 to 2,662,998, then grew a further 2.5% to 2,729,648 in 2024-25, adding 66,650 businesses in a single year. That growth rate has bounced around since 2021, from a fast 5.6% expansion in 2021-22 down to 2.0% in 2022-23 before climbing again.
Figure 3: Year-over-year growth in the total Australian business count. Source: Australian Bureau of Statistics, Counts of Australian Businesses, 2022 to 2025 releases.
The 2024-25 figures also set a record on both ends of the ledger: 437,150 new businesses entered the market, a 16.4% entry rate, while 370,500 exited at a 13.9% exit rate. Both figures were higher than in either of the two prior years, meaning more Australians are starting businesses and more are closing them at the same time.
Growth is real, but it runs on churn rather than a simple accumulation of surviving firms.
Which industries are growing fastest?
Health Care and Social Assistance grew faster than any other industry in 2024-25, up 6.6% to 213,177 businesses, ahead of Transport, Postal and Warehousing at 5.1% growth (249,289 businesses) and Financial and Insurance Services at 3.7% growth (133,743 businesses).
Figure 4: Fastest growing Australian industries by business count. Source: Australian Bureau of Statistics, Counts of Australian Businesses, August 2025.
Construction told a different kind of growth story. It generated 76,414 new business starts in 2024-25, the highest number of any industry in the country, even though its overall growth rate trailed the leaders above. A one-sentence takeaway: the industries adding the most businesses in percentage terms are not the same ones producing the most raw new-business activity.
What legal structure do Australian small businesses use?
Companies remain the most common legal structure, with 1,207,814 registered in 2024-25, up 4.7% (54,666 net new) on the year before. Sole proprietors came next at 822,873 (up 2.4%, 19,186 net new), while partnerships kept shrinking, down 4.3% to 204,703, a loss of 9,226 businesses and part of an unbroken decline that dates back to 2002.
| Structure | Businesses (2024-25) | Year-over-year change |
|---|---|---|
| Companies | 1,207,814 | +4.7% |
| Sole proprietors | 822,873 | +2.4% |
| Partnerships | 204,703 | -4.3% |
Figure 5: Australian business counts by legal structure. Source: Australian Bureau of Statistics, Counts of Australian Businesses, August 2025.
Whatever structure a business registers under, the paperwork obligations to customers do not change with the entity type. A sole trader selling online needs the same baseline legal pages as a registered company, and an online terms and conditions generator is the fastest way for either one to get a compliant document live before the first sale.
Do Australian small businesses have a website, and where do they rank globally?
Most new Australian small businesses now launch online, which fits a business population where nearly two in three firms have no employees and run lean, digital-first operations. Our companion analysis of small business website adoption covers how many operators have gone online and what still holds the rest back, and our count of UK small businesses puts Australia’s 2.66 million figure in an international context against a comparable market roughly twice its size by business count.
Australia’s business population is smaller than the UK’s in absolute terms, but the two countries land on nearly identical shares of non-employing businesses, both above 60% of the total. A one-sentence takeaway: the shift toward solo, digital-first operators is not unique to Australia, it shows up across comparable small business economies.
How many people work for Australian small businesses?
Figure 6: Key milestones in Australian business entries and exits. Source: Australian Bureau of Statistics, Counts of Australian Businesses, 2022 to 2025 releases.
Small businesses employed more than 5 million people in 2023-24, 39% of Australia’s private-sector workforce, according to the Australian Small Business and Family Enterprise Ombudsman’s (ASBFEO) analysis of ABS Australian Industry employment data. Construction alone accounted for 804,000 of those jobs at June 2024, ahead of Professional, Scientific and Technical Services at 627,000 and Accommodation and Food Services at 486,000.
Employment at businesses with 5 to 19 employees was the one size band to shrink in 2023-24, falling 6.1%, even as the total small business headcount kept climbing overall.
How long do Australian small businesses survive?
Survival splits sharply by whether a business has staff on the books. Employing businesses have a three-year survival rate of roughly 61%, compared with 43.3% for non-employing businesses, based on the ABS’s business survival data cube published alongside the June 2025 Counts of Australian Businesses release. Hiring even one employee appears to correlate strongly with a firm’s odds of still trading three years later.
That gap is worth treating as directional rather than a precise year-by-year forecast. The ABS publishes the underlying survival cube as a downloadable data table rather than a headline commentary figure, so the exact percentage point can shift slightly between releases as more recent entry cohorts are tracked. A one-sentence takeaway: non-employing businesses make up most of the population, but they close at nearly double the rate of businesses that hire.
The Bottom Line
The number worth remembering is not just 2.66 million, it is that almost two in three of those businesses, 1,735,470 of them, have no employees at all. Most “small business” coverage implicitly pictures an employer with a shopfront and a small team, but the actual Australian small business population is dominated by sole traders and single-owner operations. If you run one of those businesses, or you build tools and content for people who do, the practical numbers to plan around are a business population that grew 2.5% in the most recent year on record, a workforce of more than 5 million people, and a three-year survival rate that roughly doubles once a business takes on its first employee.
Frequently Asked Questions
How many small businesses are there in Australia? Australia had 2,656,469 small businesses at 30 June 2025, 97.3% of all 2,729,648 actively trading businesses, according to the Australian Bureau of Statistics’ Counts of Australian Businesses release, published in August 2025.
What counts as a small business in Australia? The Australian Bureau of Statistics classifies any business with fewer than 20 employees as small for its national business counts. The Australian Taxation Office instead uses annual turnover under $10 million, a threshold that captures 98% of Australian businesses.
How many people work for small businesses in Australia? Small businesses employed more than 5 million people in 2023-24, 39% of the private-sector workforce, according to ASBFEO analysis of ABS Australian Industry data. Construction alone accounted for 804,000 of those jobs.
Which Australian industries added the most small businesses in 2024-25? Health Care and Social Assistance grew fastest at 6.6%, followed by Transport, Postal and Warehousing at 5.1%, according to the ABS. Construction generated the most new business starts of any industry, 76,414 in 2024-25.
Sources and References
- Australian Bureau of Statistics. (2025). “Counts of Australian Businesses, including Entries and Exits, July 2021 to June 2025.” Published August 2025. Headline count of 2,729,648 actively trading businesses, 2,656,469 small, as of 30 June 2025.
- Australian Bureau of Statistics. (2025). “7 Facts About Australian Businesses.” Media release covering entry, exit, state, and industry growth figures for 2024-25.
- Australian Bureau of Statistics. (2025). Counts of Australian Businesses, Survival of Businesses data cube. Three-year and multi-year survival rates by employing versus non-employing status.
- Australian Small Business and Family Enterprise Ombudsman. (2025). “Number of Small Businesses in Australia.” Analysis of ABS business counts by employment size band, August 2025.
- Australian Small Business and Family Enterprise Ombudsman. (2025). “Contribution to Australian Employment.” Analysis of ABS Australian Industry employment data by business size, 2023-24.
- Australian Taxation Office. Small Business Entity Eligibility. Official turnover threshold defining a small business entity for tax concessions.
Note: All figures verified as of August 2026. Australian business population figures are refreshed at least twice a year as the Australian Bureau of Statistics and the Australian Small Business and Family Enterprise Ombudsman release updated data.
