Australia’s continued failure to support medium-sized businesses is stunting national growth, with the blind spot hindering the nation’s ability to meet its lofty climate targets. Despite substantial contributions to critical industries such as resources, infrastructure, retail and renewables, they remain relatively empty-handed when it comes to government incentives and grants.
These organisations form the backbone of Australia’s industrial landscape, often the only ones that are nimble enough to develop and adapt to changing conditions while still large enough to have a significant impact on sectors and local economies. Whether delivering key infrastructure to regional communities or providing essential goods and services, these companies are driving real progress and often leading in innovation and development.
Yet still, they remain overlooked in key government funding programs. This exclusion is not just a matter of fairness, it’s an oversight that presents real-world consequences. Despite their role in Australia’s energy transition, regional employment, and the resources sector, medium-sized businesses continue to be held to the same regulatory standards as their much larger counterparts, without access to the valuable financial support as small enterprises and start-ups.
This imbalance presents a challenge not just to the businesses themselves but also to the nation’s broader economic objectives and direction. The lack of tailored support for this group contributes to persistent skills shortages, slows the delivery of renewable energy projects, and limits the ability of capable businesses. From managing logistics networks, operating mid-tier chains, or innovating in sustainability this support is essential to scale or invest in future-focused initiatives.
Double Standards: Big Expectations, Small Support
Historically, federal budgets and policy frameworks have favoured either large multinationals or small startups. Startups are crucial for innovation but lack the capacity for large-scale delivery. Meanwhile, big corporates have the infrastructure and resources to absorb economic and regulatory shifts. It’s those caught in the middle that often fall through the cracks, plateau to failure, or get swallowed whole.
The impact of this oversight is particularly stark when considering Australia’s renewable energy targets and the skill shortages faced by these sectors. Medium-sized businesses are often tasked with meeting the same regulatory and compliance standards as much larger firms, yet they do not have access to the same resources to comply with these demands. Expectations to deliver the same level of output while meeting the same standards as large corporations without the financial cushion to do so creates a quicksand that has unfortunately proven too much for so many.
The Costs of Overlooking the Middle
From a broader perspective, capping the capabilities of the country’s business backbone hampers national progress. Australia’s energy transition will require significant infrastructure investment, much of which is being delivered by medium-sized companies across regional Australia. These companies are also key players in the renewable energy space, often providing the expertise and labour needed to deploy clean energy solutions and modernise Australia’s ageing infrastructure.
While these businesses are central to achieving the country’s climate targets, they struggle to access the support needed to keep pace with the challenges they face. Many are unable to invest in new technologies or upskill their workforces, both of which are essential to meeting the energy demands of the future. With the target deadlines of Australia’s ambitious climate and energy goals fast approaching, delays or derailment cannot be risked, rather, we should be supporting those that are doing so much of the heavy lifting.
Medium-sized businesses have the capacity to hire, train, and retain skilled workers during the crippling skills shortage facing the country, but without targeted incentives and resources, they are often forced to scale back hiring or training programs. This lack of support limits the growth potential of businesses, exacerbates skills gaps, and delays critical infrastructure projects.
A Call for Targeted Policy Support
Australia’s government needs to shift its focus and better support those that play an essential role in meeting the country’s climate and industrial goals. This can be achieved through targeted policy changes that address the specific needs of medium-sized companies, such as access to financial support for innovation, clean technology adoption, and workforce development.
By providing them with tailored incentives and funding opportunities, the government could unlock a significant source of growth and innovation. Supporting these businesses would not only help drive Australia’s energy transition but also drive employment outcomes, stimulate regional economies, and foster a more resilient and diverse industrial base.
If Australia is to meet its energy and climate targets and ensure economic stability in the face of global challenges, those in the middle must be recognised as the critical component of the solution that they are. They are the engine room of Australia’s economy, and it’s time their contributions were properly supported.
Paul Carmignani is managing director of Powertech.