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The rising cost of living is by no means a concern that’s unique to Australia at this point in time. Global financial recovery from the COVID-19 pandemic and ongoing trade restrictions has seen many countries falling into their own economic recession.
With the US and UK teetering on the brink of an economic crisis themselves, Australian economists have been preparing their own plans for ensuring that the nation is as ‘recession ready’ as possible.
But why exactly haven’t we fallen into a full-on recession just yet? With rising interest rates, and exchange rates slowly but steadily moving out of our favour, it only makes sense for the Australian economy to follow the same trends that can be observed around the world.
Thankfully, our mineral and energy export industries for Oceania are still going strong, as is our newly revitalised tech sector.
Australia’s tech industry has gone through a metamorphosis over the past few years in particular, with Aussie developers rising through the ranks to become some of the world’s most sought after specialists for a wide range of technological products and services, ranging from mobile app development to video game design, and even going as far as pioneering a new generation of digital financial service companies.
We’ll be taking a closer look at all the many branches of Australia’s flourishing tech sector and how they all work independently and collectively to buoy up the Australian economy, even under the looming threat of recession.
The unique economic landscape triggered by the COVID-19 pandemic naturally saw the Australian tech industry’s timeline for innovation get kicked into overdrive, with hundreds of thousands of companies across the nation scrambling to develop digital channels in order to support business operations and provide service to customers through months of lockdowns.
Having a strong team of tech professionals was integral to a company’s ability to adapt to the lockdown economy.
Sadly, the availability of talented tech professionals was rapidly dwarfed by the amount of work that was required in order for businesses to develop their own digital platforms and customer offerings.
As a result, tech professionals found themselves drowning in work and having to work longer hours from home in order to just keep up with all that was being asked of them. Companies dealt with this in one of two ways: hiring additional tech professionals or outsourcing their excess work to freelancers.
Outsourcing development work to freelance software developers and graduates proved to be a fruitful solution to Aussie business owners and a surefire way of strengthening Australia’s budding tech sector. Even so, this answer would go on to inspire a few more concerns for employers down the road, the most notable being in-house professionals leaving their roles after recognising the boost in potential earnings they could experience as freelancers.
This rapid shift from developers preferring in-house to freelance or contract work was the first stage of a mass exodus of professionals that would later be referred to as the ‘Great Resignation’.
The longer working hours and detrimental impacts to work/life balance did prove to take its toll on Aussie tech professionals, however. Nearing the end of the pandemic, an unprecedented number of professionals with technical skills began leaving their roles at the end of the pandemic and seeking new employment opportunities, either in new and exciting industry niches or even with young and fresh start-up companies.
This mass exodus of professionals has also been observed all over the world, with big tech conglomerates like Apple even being affected by their own skills shortage.
Although COVID-19 burnout and the Great Resignation both held an immediate negative impact on big businesses, it did empower smaller companies to start focusing on their own growth, alongside inspiring a new generation of start-up companies, some of which have made major contributions to the global tech industry, to say the very least.
Many homegrown Aussie tech companies were able to use 2020’s lockdown economy to carve out a foothold in the global tech sphere. One of the most notable examples here has to be Nick Molnar and Anthony Eisen’s fintech (or ‘financial technology’) company AfterPay.
The acquisition of AfterPay by US tech giant Block, Inc. (formerly Square, Inc.) was just one of Australia’s most prominent success stories within the tech industry, prompting globally renowned industry bodies and leaders to start considering Australia a veritable hub of technological innovation in its own right.
As AfterPay continues to dominate the personal financing services market, more homegrown fintech innovators were able to develop their own fintech products and services, firmly placing Australia on the map within one of the world’s most novel and undeniably lucrative modern markets.
The potential for fintech as an industry to bolster Australia’s national economy can already be observed by the addition of Block, Inc. stocks on the ASX, as well as the establishment of industry bodies like FinTech Australia.
The cities of Melbourne and Sydney have been making space for fintech companies, with industry infrastructure ranging from company HQs and tertiary institutions being developed in response to the industry’s monumental current and projected growth.
Of course, there is more to the Australian tech industry than just business development alone. Software development is just as much an art form or a form of expression as it is a professional skill.
And although Australia may have arguably been lagging behind with regards to technological innovation before the pandemic, many months of lockdowns did inspire creative developers to create a collection of video games that have gone on to touch the hearts and minds of gamers across the globe.
Australian video games like Hollow Knight and the infamous Untitled Goose Game have consistently found themselves on highest rated lists around the world. Alongside this, the independent game development studios credited with these games have benefitted from exposure to an international gaming community that eagerly await their next creations.
But is there potential for the gaming industry to do its own part with regards to making Australia ‘recession ready’? Some industry experts assert that there actually is, particularly because a thriving local gaming industry and strong gamer community will consistently make Australia’s capital cities (with Melbourne and Brisbane, in particular) being the perfect location for industry events like eSports tournaments and conventions, to name just a few.
In fact, even the federal government has recognised the potential of Australia’s gaming industry to propel the economy to greater heights. This is precisely why the Digital Games Tax Offset had been established over 2021 in preparation for it coming into effect in this new financial year.
In truth, Australia’s tech industry is in itself, a beast with many heads, all of which have been paving the way for future innovations in their respective industry niche.
Future tech professionals have an abundance of choices with regards to professional and educational opportunities, and with the ongoing development of industry infrastructure and international investments, it’s safe to assume that Australia’s tech sector will continue to thrive both during and after a recession, if that cloud does happen to fall.