Digital platforms to reshape Australia's residential tradie economy

14 January 2019 4 min. read
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The Australian residential tradie economy last year generated $73 billion – accounting for nearly 6% of the national GDP – with three-quarters of Australian households using the services of at least one of the nation’s more than 250,000 residential tradie businesses. But here’s a staggering figure: more than 70% of consumers still rely on word of mouth or previous personal experience when it comes to hiring a tradesperson.

Based on extensive research by management consulting firms EY and L.E.K. Consulting, taking into account both consumers and tradespeople, online service directory HiPages constructed a report titled, ‘The On-Demand Tradie Economy’, which establishes a groundwork for the current state of the residential trade industry.

While the speed with which the industry adapts to the digital landscape may justly be seen as lagging, millennials and younger generations are more willing to use online sources to both help and seek work. Of those surveyed, 53% aged under 35 said they would use a search engine such as Google to source a tradie, going against a score of 39% of the overall population. Social media, as well, has a much greater hold on younger people, with 36% of those under 35 using various platforms to seek help (compared to a scant 19% overall).

How are tradies sourced in Australia

Younger tradies are also more willing to use the internet to source work. Thirty-six percent of millennial tradies said they used the internet in some manner for their business, be it for marketing or admin. Nearly a quarter (21%) of all tradies said they expected more work from online third-party sites in the coming two years.

Digital shift

All signs point according to the researchers toward an industry shift – one that is already occurring. Tradespeople and consumers know that technology can make the residential trade industry run more smoothly. Tradespeople are also seeing more and more business originate from online sources. “Nearly half of all Australians agree that connecting with tradespeople online can be significantly quicker than traditional channels,” the report states.

This is an opinion that simultaneously touches several “pain points” of both consumers and tradies, nearly all of which can be at least somewhat alleviated by a digital shift. A great deal of these points, unsurprisingly, revolve around financials – a hesitance to pay in cash, timely payment, preparing quotes, unforeseen costs. Each is a problem that could be soothed via a regulated, third-party, online platform.

Pain points for tradies and consumers

On the tradies’ side, there is also the issue of “on the clock” time spent not making money. “Tradies cited liaising with customers as the task that they spend the most time on in an average week,” the report states. Payroll and other administrative tasks also consume time that could be spent working. On any given week, tradies spend approximately 20 hours on admin and seeking work.

“One in four tradies have been forced to give up jobs due to the burden of admin in the past 12 months, which costs them an average of $120,000 worth of business annually.”

It’s no wonder, then, that tradies are in agreement, with 70% believing that the right technology for their business could save them time and money. Platforms that connect consumers and tradespeople are the obvious answer – such platforms, in fact, already exist. Those tradies savvy enough to use them will be rewarded with more leads and less admin time, while consumers will be able to find reliable, honest help with the click of a mouse.

Globally, the market size of the platform economy is estimated to be $7 trillion, according to an analysis featured on, with the seven ‘super platforms' - Apple, Amazon, Microsoft, Google, Facebook, Alibaba and Tencent - dominating the landscape.

Related: Phoenixing costs Australia’s economy $5 billion, finds PwC report.