Professional services grow to become one of Australia’s largest industry groups
The Australian professional services industry has grown by 30% since the beginning of the decade to become the fourth largest industry group in the country. New data released on Tuesday by the Australian Bureau of Statistics has revealed that the professional, scientific and technical services sector now employs over 1.1 million people.
As Australia’s economy has been shifting since the end of the mining boom roughly 20 years ago, there has been a growing number of white collar workers. The professional services sector currently sits behind healthcare, retail and accommodation, and food services which have been driven by an ageing population and growing levels of tourism across the country.
Data released by the ABS shows that 1 out of every 11 Australian workers is a white collar worker. Out of the country’s 13.7 million workers, 1.1 million are employed within the professional services sector. The sector has overtaken both manufacturing as well as construction in the seven years to September 2017 to make it one of the largest sectors in the country.
Whilst Australia is still a large commodity exporter and the construction industry has recently been experiencing sustainable growth, the economy as a whole is beginning to diverge. This shift marks the beginning of a transition towards an information society or digital economy, the likes of those seen in North and Western European nations or the city states of Asia.
Digital economic transition is also a key driver of the growth in professional services, particularly in the high-end, prestigious consulting industry. With jobs across all sectors from tax and audit to human resources becoming increasingly automated, traditional accounting firms are extending into digital and consulting.
Although data was not available on the breakdown of jobs in the professional services sector, the Australian consulting industry is currently one of the most profitable in the world in relation to the country’s national income. Currently worth over $4.6 billion a year, the consulting market of Australia relative to GDP is now 0.39%, which is higher than both that of the UK (0.38%) and the US (0.32%).
Australian consulting industry 2018
Australia’s consulting industry is growing at an exponential rate with the Big Four consulting firms – KPMG, EY, PwC and Deloitte – all posting double digit growth in the past year. Growth has been based both locally and internationally due to a number of factors including heavy public sector funding, broad competition and international expansions.
As Australia is on Asia’s doorstep, the consulting industry is profiting from a growing number of expertise seeking companies which see Australia as a reputable business centre. Australia is also a logical step for many Asian firms looking to expand their international footprint whilst still being close to home.
At home, many firms – both local and international – are looking to capitalise on the growing number of businesses looking towards digital transformation. “Clients' desire to undertake major cross-functional digital transformation projects are now translating into an uplift in consulting spend across most sectors, but particularly in healthcare, the public sector and financial services," said Source’s director Edward Haigh.
Professional services growth
Professional services as a whole grew to a record high in the past year with the number of hours worked in professional services jumping 11.8% to 481.2 million hours. The ABS statistics show that whilst the total labour income from the entire economy only grew 3.4% over the year to September 2017, the total labour from professional services grew an astonishing 16%.
Chief economist at the ABS, Bruce Hockman said the report confirms the shift in the largest industry sectors in the country. Professional services now account for 8.6% of total employment in Australia and make up more than 1.1 million jobs.
"These new estimates show that, through the year to September 2017, the professional, scientific and technical services industry increased by over 13 per cent, the fastest of any industry in the economy," Hockman said.
Interestingly, Hockman also touched on the fact that a large minority of these jobs were not full time, but rather side jobs. “The Australian Labour Account showed that over 70,000 of these jobs in the professional, scientific and technical services industry were secondary jobs, where the person had another main job.”
Related: Best | most popular consulting firms for graduates in Australia.
