Small Business Productivity Trends and Strategies

This report is a special analysis focused on small business productivity trends, implications, and strategies from January 2017 to December 2023. It utilizes anonymized and aggregated data from over 240,000 small businesses across Australia, New Zealand, and the United Kingdom. The report outlines key trends in labour productivity, highlighting a decline during the pandemic lockdowns and a subsequent rebound that remains below pre-COVID levels. It documents that New Zealand small businesses have led in productivity, followed by Australia and the UK. The report explains the unique aspects of the Xero Small Business Insights (XSBI) data, emphasizing its focus on small business metrics and the use of objective data rather than subjective surveys. The report also discusses the implications of these trends for small businesses, their advisors, and governments, stressing the need for improved productivity to foster economic growth and lower inflation. The findings underscore the importance of understanding small business productivity dynamics to inform policy decisions.