Perth business and succession advisor Kimmaree Thompson on what the report means for small business owners approaching exit.

Perth, WA: The 2026 Intergenerational Report shows Australia’s population ageing faster than previously projected, and Australian business owners as a smaller share of total employment. Perth business and succession advisor Kimmaree Thompson says the two trends together should prompt a rethink of how owners plan their exit.

The report finds business owners have fallen from about 20 per cent of total employment in the early 2000s to 15 per cent in 2025. It also points to rising market concentration and weaker job creation in small businesses compared with larger firms. The Government has asked the Productivity Commission to inquire into barriers to business dynamism.

“Every small business that closes instead of changing hands leaves a gap that is too often filled by a multinational with a generic one-size-fits-all offer,” said Ms Thompson, Principal Partner at Authentically Agency. “Behind those numbers are local businesses that know their clients by name and shape a service around them. We can’t afford to lose that personality, creativity and flexibility. Succession isn’t only a retirement issue for owners. It’s about keeping Australian business responsive to the needs of Australian clients.”

Business exit as a process, not an event

The report projects the population aged 65 and over will grow by 87.1 per cent between 2025-26 and 2062-63. Participation among people over 65 has risen by 9.5 percentage points since the 2002 report. Ms Thompson says owners can use that trend to plan a lower-risk gradual transition out of the business.

“Stepping down as a business owner doesn’t have to mean walking away, or being paid once, on settlement day,” she said. “A management buy-in with staged vendor finance or an earn-out lets a new leader step in gradually while the owner continues to be paid over several years. It keeps hard-won knowledge in the business and gives younger family members or external buyers time to build capability rather than taking on everything at once. Depending on the structure, it may also have tax advantages. Qualifying earn-outs can receive ‘look-through’ capital gains tax treatment for up to five years.”

Older owners, building capability with younger workers

The report notes early international evidence of falling employment for young workers in AI-exposed occupations, although it is not yet visible in Australian data.

“If AI continues to reduce entry-level roles in large organisations, small businesses run by experienced owners can still offer a young person a start and the chance to build practical skills that local customers need,” Ms Thompson said. “That’s another reason to keep good businesses open and transferring to new owners, rather than closing businesses down when their ageing owners retire.”

 Super is maturing, but for many the business is the retirement plan

The report projects the median superannuation balance for people aged 65 to 69 will rise from $204,000 in 2024 to approach $450,000 in the medium term.

“That’s good news, but for many owners the business itself is the second pillar of retirement,” Ms Thompson said. “A business that can’t run without its owner is a retirement plan with a discount already built in. The most valuable thing an owner can build is a business that keeps paying them after they’ve stopped working in it.”

Key related figures from the 2026 Intergenerational Report

• Business owners as a share of total employment: about 20 per cent in the early 2000s, 15 per cent in 2025 (p. 200)
• Population aged 65 and over: projected to grow by 87.1 per cent between 2025-26 and 2062-63 (p. 82)
• Participation rate for people aged 65 and over: up 9.5 percentage points since the 2002 report (p. 87)
• Median super balance, ages 65-69: $204,000 in 2024, approaching $450,000 in the medium term (p. xv)

About Kimmaree Thompson

Kimmaree Thompson is Principal Partner at Authentically Agency, a Perth-based business, succession and transformation consultancy service.  Kimmaree Thompson over two decades of business consultancy and change management experience, she is also the author of Australian Business Exit Planner & Workbook: Succession Planning for Wealth and Legacy.

Kimmaree Thompson works with Australian business owners approaching succession, professional services firms, and government and corporate organisations,

Website: authentically.agency   

Books: https://www.amazon.com.au/stores/Kimmaree-Thompson/author/B0BST77Z3G/allbooks