Sydney’s business growth hotspots revealed – and the ‘missing middle’

Sydney's western suburbs are rapidly transforming into the state's leading entrepreneurial hub, according to a new report by Business NSW. The analysis reveals that western Sydney could surpass eastern Sydney in the number of businesses that employ staff within 15 years. Between 2017 and 2025, nearly 23,000 employing businesses opened in the western suburbs, compared to just over 10,000 in the eastern part of the city. Blacktown council area saw the largest increase, with a 17 per cent rise in businesses that employ others after accounting for population growth. Canterbury Bankstown followed closely with a 13.5 per cent increase, while Hawkesbury and Fairfield recorded gains of 13.2 per cent and 13.1 per cent respectively. According to the report, these developments are attributed to recent infrastructure investments in western Sydney, combined with a younger demographic, growing industrial diversity, and improving skill levels. Api Yuganathan, co-founder of HealthcareLink, a specialist online recruitment platform based in western Sydney, highlighted the vibrant business environment in the region. Her company, which employs 15 people, operates from a startup hub in North Parramatta that supports small and medium-sized enterprises in expanding their reach and accessing new opportunities. Yuganathan noted the constant influx of individuals with novel business concepts utilizing the shared workspace. She expressed admiration for the innovative approaches being developed by smaller enterprises to tackle practical issues. “It’s been inspiring to witness the range of business opportunities people are pursuing here in western Sydney,” she remarked. Joseph Carrozzi, president of Business NSW, emphasized that the surge in entrepreneurial activity in western Sydney indicates a profound transformation in how Sydney is evolving economically. He stated that western Sydney is increasingly recognized as one of Australia's key economic regions due to the enterprising nature of its residents. Meanwhile, in Sydney's eastern areas, notable business growth centers include the Bayside local government area, encompassing Kingsford Smith Airport, which saw a 12.7 per cent increase in employing businesses between 2017 and 2025. Randwick Council also demonstrated robust business expansion, with an 11.1 per cent rise, seemingly influenced by its newly established light rail link and the presence of significant healthcare and research facilities in the region. The Sydney City and North Sydney councils, which cover the traditional central business district and North Sydney employment centers, maintain the city's highest concentration of businesses relative to population size, trailed by Willoughby, Woollahra, and Hawkesbury. Despite the robust business creation rates in New South Wales, the report highlights a critical gap: many startups fail to transition from solo operations to businesses that hire additional personnel. In 2000, 8 per cent of the NSW workforce owned and managed businesses with employees. However, this figure has dropped below 5 per cent, marking the lowest level in at least 35 years. If the 2000 rate of entrepreneurship remained unchanged, NSW would currently have an additional 135,000 entrepreneurs managing employment-generating businesses, according to the report, which was compiled in conjunction with the Sydney University Business School. This decline is particularly pronounced among women, who historically have been less inclined to operate employment-generating businesses compared to men. For men, the proportion of employing business owners relative to all employees reached a peak of 10.6 per cent in 2001 before declining to 6.7 per cent by early 2026. Similarly, the percentage of women in the workforce owning such businesses peaked at 6.4 per cent in late 2001 but had decreased to 2.7 per cent by early 2026.