So far, 2025 appears to be bringing faster, more pronounced changes to Australia’s SMEs. That’s due to economic uncertainty, inflation pressures, accelerated digital transformation, workforce challenges, changing consumer and B2B expectations, and regulatory and policy shifts.
Curious about where your SME stands amidst all this?
A key indicator of business growth is requests for insurance policies. They offer useful insights into where new businesses are emerging and which sectors are losing ground.
Learning about these shifts can help inform decision-making for your own business strategy.
Which Small Business Sectors Are Booming aka Growing?
Some of Australia’s fastest-growing small business sectors are responding to social, economic, and demographic changes.
Insurance data shows these industries had the most significant percentage increases in policy requests over the past 12 months:
- Societies, associations, and groups (36.2%): Community engagement is rising, with more local and charitable groups forming and requiring insurance cover
- Tax services (34.6%): Economic uncertainty has increased demand for financial expertise, with businesses and individuals seeking more professional tax advice
- Property (34.3%): Interest in both residential and commercial property is strong, driving growth in real estate and property-related services
- Complementary therapies (32.7%): Alternative health services, such as massage therapy and naturopathy, continue to attract clients looking for holistic wellness solutions, and
- General services (31.8%): A broad category ranging from IT support to personal services, reflecting the demand for outsourced expertise.
Many of these growing sectors are driven by evolving consumer behaviours, a greater focus on financial security, and a higher inclination for alternative health and wellness options.
Keep in mind, a growing sector is not the same as a growth sector. Growing sectors are expanding, typically due to short-term trends, and may not have a long-term track record of stable growth, unlike growth sectors. Growth sectors in Australia are renewable energy, healthcare and aged care, technology, and cybersecurity. Growing sectors include AI and automation, social commerce, influencer marketing, and electric vehicles.
Industries Seeing High Volume Growth
Beyond the fastest-growing sectors, several industries have seen a surge in new business registrations, reflecting significant expansion:
- Aged and disability care: Demand for aged care and disability support services has soared due to the National Disability Insurance Scheme (NDIS)
- Cleaning and gardening: With more Aussies outsourcing household maintenance, this sector has seen strong demand from both private clients and government-funded home care services
- Post-construction services: The ongoing property boom has increased demand for services such as site clean-ups, plumbing, and electrical work after construction projects wrap up
- Allied health: The popularity of preventative healthcare has driven expansion in services like physiotherapy, occupational therapy, and mental health support, and
- Business consulting: More small businesses are turning to consultants for strategic guidance, particularly in financial management, operations, and digital transformation.
These sectors are experiencing steady demand, with government funding and demographic changes helping boost their sustained growth.
Small Business Sectors Facing a Slowdown
While some industries are thriving, others are experiencing a decline.
A drop in insurance policy requests suggests that fewer new businesses are entering these sectors:
- Surveying (-15.7%):Slower infrastructure spending and competition from larger firms have impacted demand for small surveying businesses
- Data processing, web hosting, and electronic information storage (-15.4%):Automation and the dominance of big cloud providers are squeezing out smaller players in this space
- General retail (-9.8%):The ongoing shift to e-commerce has made it harder for traditional brick-and-mortar stores to compete
- Tertiary education (-6.9%):Changing education models, along with declining international student numbers, have reduced demand in this sector, and
- Wood and paper manufacturing (-6.7%):Sustainability concerns and changes in consumer behaviour have contributed to the decline of traditional paper and timber industries.
For businesses in these sectors, adapting to new trends—such as embracing digital transformation or diversifying services—may pave the way for long-term sustainability.
Managing Business Risk in a Changing Economy
As small businesses navigate these trends, managing risk has never been more important. Each sector faces unique challenges, and the right insurance coverage can provide protection against unexpected setbacks.
Typical types of coverage to consider include:
- General liability insurance, including public and products liability: Crucial for companies where visitors and customers attend the business premises and for injuries to third parties from defective products
- Workers compensation: Mandated for any business that employs staff
- Management Liability: A packaged policy designed to protect businesses, directors, and officers from financial exposures arising from the decisions and responsibilities involved in running a company, including claims related to wrongful acts or decisions
- Professional indemnity insurance: Particularly relevant for tax professionals, consultants, and allied health providers offering expert advice or services
- Property insurance: Essential for businesses in property management, cleaning, and construction services, protecting against damage or loss
- Cyber insurance: A growing necessity for any business handling customers personal information and clients sensitive and confidential data
- Business interruption insurance: Helps cover lost income in the event of an unexpected disruption, allowing businesses to recover faster.
The business landscape is changing, but with the right insights and protections in place, you can take advantage of emerging opportunities while safeguarding against risks.
As your broker or adviser, we can tailor coverage to suit your specific industry, ensuring your business stays protected no matter the market.
