The Top 5 Fastest Growing Industries of 2023

When COVID-19 brought the world to a standstill, the economic landscape looked bleak. However, the future appears increasingly optimistic as the world enters a new post-pandemic era.

While many industries still face uncertainty, some are experiencing accelerated growth. Ever-advancing tech dominates – be it artificial intelligence, cloud-based solutions, or electrified driving. Then there’s a burgeoning beverages market and a rebounding travel industry.

Let’s dive deeply into 2023’s fastest-growing industries that are riding a fresh wave of success into the new year.

1 The travel and tourism industry

After almost three years of on-and-off lockdown, travel is bouncing back bigger and better than ever in 2023, as people are eager to get out. According to a YouGov for World Travel & Tourism Council survey, international travel is expected to exceed pre-pandemic levels in 2023.

It’s great news at home, too. In 2020 international tourist arrivals declined by 73%. But in the year ending September 2022, there were 2.2 million arrivals, up 1184% compared to the year ending September 2021.

Lifted restrictions have prompted an explosion in the travel and tourism industry. According to IBISWorld, Australia’s top three fastest-growing industries all come under the travel umbrella. The top is travel insurance, with a projected 2023-24 revenue growth of 206.0%, followed by foreign currency exchange at 128.5%, then inbound tour operators at 87.1%.

Overall revenue in the travel & tourism market is projected to reach AU$20.08bn in 2023.

So what hot travel trends are contributing to this soaring wanderlust? Despite competition from Airbnb, hotels are back in fashion, with 60% of Aussies planning a 2023 hotel stay, according to Expedia.

The desire for 5-star accommodation is on the rise, with luxury accommodations expecting 42.7% revenue growth for 2023-24. At the other end of the travel spectrum, off-grid escapes are on the up, with almost half of Australian travellers planning an eco-friendly getaway, according to booking.com.

2 The renewable energy industry

As global Net Zero 2030 goals loom ever closer, the world is rapidly pivoting to renewable energy sources, and consumers are becoming more conscious of sustainability and their environmental impact. By 2024, almost 33% of the world’s electricity is forecast to come from renewables.

In 2022, the National Electricity Market reported that renewables reached a milestone of powering 50% of Australia’s primary electricity grid. Rooftop solar provided nearly 24%, followed by wind at 16%, large-scale solar at 9% and hydro at 2%.

Australia’s wind farm industry has climbed almost five-fold over the ten years through 2021-22 and is expected to expand rapidly over the next five years with expected revenue growth of 52.6% in 2023/2024.

An abundance of Australian sunshine and solar voltaic panels are a match made in heaven. As such, the solar power industry is prosperous, and market analysis predicts a compound annual growth rate of 20.56% until 2027.

Currently, Australia’s renewables industry employs 28,000 people. This is predicted to grow to 45,000 by 2025, making it one of the fastest-growing industries in 2023.

3 The beverage industry

From wellness-inspired refreshments to alcohol-free drinks, Australian drinks trends are driving a thriving market. Revenue in the beverages segment is projected to reach AU$5.09bn in 2023, with an annual growth rate (CAGR 2023-2027) of 15.25%, resulting in a projected market volume of AU$8.99bn by 2027.

With consumer thirst for imaginative drinks at a peak, it’s no surprise the industry is booming. Indeed, the Australian Financial Review hails fruit-flavoured alcohol seltzer brand Fellr Australia’s fastest-growing new company. Launched during the first lockdown, Fellr turned over just $11,701 in 2019-20 but made $4.5 million in revenue during 2021-22, giving it an 1863% compound annual growth rate over the last three financial years.

Non-alcoholic drinks now have a 3.5% share of the total beer, spirit and wine market. Worth already $152 million a year in Australia, alcohol-free drinks are forecast by IWSR to rise at a rate of 31% a year until at least 2024.

Testament to the growth of this market, alcohol-free spirit brand Naked Life is another homegrown success story, hot on the heels of Fellr with a CAGR of 331% over the last three financial years. Launched in 1016, Naked Life achieved a $357,694 turnover in 2019-20, Naked Life trebled its range and hit $6,655,929 revenue in 2021-22.

4 The next-gen tech industry

We’re not just talking apps but seriously futuristic, market-disrupting technology. From augmented reality to artificial intelligence, game-changing innovation is dramatically rising.

Thanks to ground-breaking agencies like Next/Now and Groove Jones, in 2023, the Australian augmented reality, and virtual reality market is expected to reach AU$1,488.00m, with a CAGR 2023-2027 of 15.28%. As many manufacturing occupations become automated, the robotics market is projected to reach AU$860.10m in 2023.

One lasting impact of Covid is its working-from-home culture. According to PwC, 90% of the workforce in Asia-Pacific prefers to work remotely or hybrid. This shift in work life has spurned the trend for businesses to adopt cloud-based technology.

Australia’s cloud computing market is tipped to grow by 12.5% to $14.1bn in 2025 as a result of this trend. “Cloud-based platforms and services continue to be a key element of this ongoing transformation, thus driving the enterprise spending on cloud in the country,” Saurabh Daga, technology analyst at GlobalData, told Computer Weekly.

Australia’s tech industry is attracting major global investors as the industry flourishes. Google intends to invest AU$1 billion in Australian tech start-ups and a regional research hub in Sydney through 2026, while other major venture capital investments include Sequoia Capital China, Blackbird Ventures, AirTree Ventures and Index Ventures.

5 The zero-emissions vehicle industry

A record 33,410 EVs were sold in Australia during 2022, up 385% on the 8,688 in 2021. According to IBISWorld, the electric vehicle wholesaling industry is expecting a 41.2% growth in revenue in 2023-24.

Despite a slow start for EV adoption in Australia, demand is rising rapidly due to consumer desire to switch to sustainable driving solutions. The zero-emissions vehicle industry is finally accelerating in the fast lane, and this is down to three major factors.

Firstly, new EV models entering the Aussie market brings more consumer choice. Secondly, growing EV infrastructure is making EV ownership easier and more desirable for owners. Thirdly, as the sales of petrol and diesel cars are to be phased out around 2035, consumers are choosing to future-proof their transport by making the switch to an electric car now.

The outlook is exciting. Revenue in the EV market is projected to reach AU$2.88bn in 2023, with an annual growth rate (CAGR 2023-2027) of 22.75%, resulting in a projected market volume of AU$6.55bn by 2027.

Summary

1 The travel and tourism industry is bouncing back strongly, with Australia’s top three fastest growing industries all coming under the travel umbrella. Travel insurance has a projected 2023-24 revenue growth of 206.0%, then foreign currency exchange at 128.5%, then inbound tour operators at 87.1%.

2 Australia’s wind farm industry is expected to expand rapidly over the next five years with an expected revenue growth of 52.6% in 2023-24. Market analysis predicts a compound annual growth rate of 20.56% until 2027 for the solar power industry. Australia’s renewables industry is predicted to grow to 45,000 employees by 2025.

3 Australia’s beverages industry is projected to reach AU$5.09bn in 2023, with an annual growth rate (CAGR 2023-2027) of 15.25%. Fellr is officially Australia’s fastest growing new company with a 1863% compound annual growth rate over the last three financial years. Alcohol-free drinks are forecast by IWSR to rise at a rate of 31% a year, until at least 2024.

4 In 2023 the Australian augmented reality and virtual reality market is expected to reach AU$1,488.00m, while the cloud computing market is tipped to grow by 12.5% to $14.1bn in 2025. Google is intending to invest AU$1 billion in the Australian tech industry. Major investors include Sequoia Capital China, Blackbird Ventures, AirTree Ventures and Index Ventures.

5 The electric vehicle wholesaling industry is expecting a 41.2% growth revenue in 2023-24. 2022 Australian EV sales were up 385% on 2021. Revenue in the EV market is projected to reach AU$2.88bn in 2023, with an annual growth rate of 22.75%, resulting in a projected market volume of AU$6.55bn by 2027.

If you are a part of one of these growth industries and need assistance in hiring support, contact a recruitment agency like Trojan Recruitment Group and receive advice from the experts in labour-hire, temp, permanent and contract staff.

Sources

https://www.ibisworld.com/australia/industry-trends/fastest-growing-industries/
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