iscoverThe second quarter of this year saw Australian small businesses maintain their stability despite continued economic challenges, MYOB has revealed.
Aussie SMEs reflect stability in Q2 2025: MYOB
04 September 2025
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9 minute read
According to the latest version of the MYOB SME Performance Indicator, small businesses maintained their stable levels throughout the second quarter of this year, however, gross value added (GVA) was 5 per cent lower than the same period last year.
The findings showed the strongest performing sectors over the three-month duration were mining, public administration and agriculture, while hospitality, arts and recreation were the weakest.
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Paul Robson, chief executive of MYOB, said overall the SME community had demonstrated solid profitability and productivity as the economy continued to normalise post-pandemic.
“The latest indicator demonstrates that Australian SMEs have remained resilient. Profitability and productivity have held steady and payroll growth per employee has kept pace with the wider economy,” he said.
“We saw early signs of performance calibration at the end of 2024 and it’s pleasing to see this maintained in the first half of the year.”
MYOB said its indicator anonymised observations from more than 200,000 businesses with 1-19 employees and calculated GVA by calibrating small business performance against the economy as a whole and aggregated information from millions of transactional data points.
GVA was noted to be a measure of the value of goods and services produced in the area, industry, or sector of an economy.
Robson said the MYOB indicator indexed productivity against the overall GVA to gain an insight into how Australian businesses had been performing.
According to MYOB, the SME sector had seen substantial movement since the pandemic, with a noticeable lift in new entrants from the startup sector and many SMEs had outgrown the sector as they grew into larger operations.
“Despite a slight reduction in pandemic-era small business creation, as well as disruptive economic factors such as US tariffs, rising operating costs and reduced consumer spending, SMEs have maintained solid profitability and productivity, demonstrating the resilience of this community,” Robson said.
“Looking ahead, broader economic conditions are becoming more supportive for SMEs, with inflation easing and a recent cash rate cut from the RBA. These developments should provide some relief to Australian households, resulting in greater consumer spending.”
Agriculture ranked as the highest performing SME sector and recorded a 13 per cent rise in activity over the past year and a 5 per cent increase in its GVA over the quarter.
This growth was linked to strong agricultural commodity prices domestically and in export markets, robust overseas demand and increased productivity, driven by increased technology adoption and digitisation within the sector.
Robson added that the findings indicated that momentum looked to remain positive for the industry, however, economic obstacles could present potential risk.
“The uplift in performance for Australian small businesses within agriculture is encouraging for the industry and the SME sector more broadly,” he said.
“The resilience of agricultural SMEs is further reflected by their growth amidst significant hurdles, including the introduction of US tariffs and several flood events that caused localised disruption for many of our farmers.”
In addition to this, the growth over the last 12 months was largely confined to industries that benefitted from significant price movements, which were predominantly mining and agriculture.
Over the next 12 months, there were positive signs for growth in other sectors too, according to Oxford Economics Australia associate director and economist Alex Hooper.
Hooper said even as the number of SMEs had eased back from pandemic highs, the sector continued to demonstrate resilience.
“Individual business profitability and productivity, underpinned by strong payroll growth, highlight the ability of SMEs to lift wages in line with broader economic trends.”
“This adaptability has allowed SMEs to turn a period of adjustment into a platform for future growth. And, with rate cuts and easing inflation creating a more supportive environment, SMEs are well positioned to continue contributing meaningfully to Australia’s economy.”
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