Tech growth helps push WA to global stage

Tech growth helps push WA to global stage

Tue, 12/06/2018 - 09:09

EVOLVING Perth’s startup scene has invigorated the city as other industry sectors came off the boil. Photo: Shutterstock

Rapid expansion in Perth startups has the city poised to become a regionally significant technology centre.

As the mining construction boom came off from 2012 to 2017, other sectors grew a collective 62 per cent, says a report from Y Research commissioned by the City of Perth.

A study published last year (Shared Work Spaces and Technology Study) prepared by independent property research company Y Research has shown some distinct employment trends within the Perth CBD over the past five years.

Towards the end of 2012 two seemingly unrelated (but ultimately linked) events took place.

Local iron ore producer Fortescue Metals Group (itself a startup just 10 years earlier) laid off 2,000 workers.

Meanwhile, across town, the first Startup Weekend took place at the new co-working space that called itself Spacecubed (now Riff).

The Fortescue announcement was the first of many such calls from across the local resources industry, marking the end of the incredible mining construction boom that had held sway for almost a decade.

The mining industry had trebled in size during that time, as had local property prices, and it is unlikely any of us will see either phenomenon again.

Just as people would be piling out of the mining sector (5,000 fewer city workers would be employed within the industry over the next five years), the startup scene and ecosystem was just being born.

Redundancy cheques can provide the means to set up that idea you have always been looking to do, and it can give you the impetus and opportunity also.

An additional 3,000 people would depart the oil and gas industry in Perth during that timeframe as well, and some of them would also look to retrain or start their own business, or depart these shores for greener pastures.

“At the peak of the boom, 70 per cent of occupied space in the Perth CBD was by resources companies, firms servicing the resources industry and the government,” the report said.

Office vacancies during the peak of the boom in 2008 were driven to a world low in Perth, at under 0.5 per cent.

As the boom ended, those same workers departed, new office developments were coming on stream (at precisely the wrong time) and vacancies were driven up to more than 25 per cent, levels not seen since the 1960s.

The WA economy needed a transition, and one of the bright spots was tech companies and shared office (and co-working) spaces.

The report found there was a total of 24 shared office work facilities in the city, collectively occupying 22,400-plus square metres.

There were 38 new tech companies working out of these spaces, employing 803 staff.

The tech sector growth was the largest of any sector in Perth. It is now the eighth largest employer in town.

A more recent report, also produced by Y Research, has shown the tech sector has added more jobs than any other sector, apart from legal services.

“From my Perth CBD Office Tenant Census, the report developed by going floor by floor through every office building in the CBD, the technology sector in the CBD has grown by 42.5 per cent between 2012 and 2017 – delivering approximately 901 new jobs,” Y Research principal Damian Stone told Startup News.

“Education, shared work spaces, medical and PR/marketing are the other key sectors,” Mr Stone said.

“Collectively, these industries have grown by 62 per cent since the boom.”

Perhaps Perth will become the tech centre (in this time zone) many of us believe is within its grasp.

Perhaps we will diversify our local economy and cease being a ‘one-trick pony’.

Let’s hope these statistics are proof this is already happening.