(31 July 2026 – Australia) A growing divide is emerging across Australia’s small and medium enterprise (SME) sector, with workforce stability increasingly separating businesses positioned for growth from those facing mounting operational pressure.
Findings from the latest ScotPac SME Growth Index based on East & Partners research reveal 1 in 3 SMEs experienced higher staff attrition in the past year. The finding continues the significant decline in average SME headcount from 88 full-time equivalent employees in 2014 to just 51 today.
Businesses that reported lower staff turnover were significantly more likely to expand, with 15 per cent recording revenue growth, ten percent entering new markets, and a further ten percent taking on larger orders and transactions.
ScotPac CEO Jon Sutton said the findings reflected a broader shift in how SMEs were approaching productivity.
“Australian SMEs are becoming significantly leaner businesses, and we are increasingly seeing that productivity is no longer simply about workforce size,” Sutton said.
“The SMEs performing strongest are often those investing in workforce stability, smarter operational processes, technology adoption and flexible business structures that allow them to scale more efficiently.”